15-Year vs 30-Year Mortgage
Compare 15-year and 30-year mortgages. Learn the differences in monthly payments, total interest, and which loan term is right for your situation.
15-Year Mortgage
Pros
- ✓Pay off your home faster
- ✓Save tens of thousands in interest
- ✓Build equity quickly
- ✓Lower interest rates (typically 0.5-1% lower)
- ✓Forced savings discipline
Cons
- ✗Higher monthly payments
- ✗Less financial flexibility
- ✗May limit how much home you can afford
- ✗Harder to qualify for
Best For
Borrowers with stable, higher incomes who want to minimize total interest costs and own their home outright sooner.
30-Year Mortgage
Pros
- ✓Lower monthly payments
- ✓More financial flexibility
- ✓Easier to qualify for
- ✓Allows purchasing a more expensive home
- ✓Extra cash can be invested elsewhere
Cons
- ✗Pay significantly more interest over time
- ✗Build equity slower
- ✗Higher interest rates
- ✗Longer time to own home outright
Best For
Borrowers who prioritize lower monthly payments, want more budget flexibility, or plan to invest the difference.
Key Differences at a Glance
| Factor | 15-Year Mortgage | 30-Year Mortgage |
|---|---|---|
| Monthly Payment ($300K loan) | ~$2,108 at 6% | ~$1,799 at 6.5% |
| Total Interest Paid | ~$79,000 | ~$348,000 |
| Interest Rate | Typically 0.5-1% lower | Standard rates |
| Time to Own | 15 years | 30 years |
| Monthly Cash Flow | Less flexible | More flexible |
The Bottom Line
The best choice depends on your financial situation. If you can comfortably afford the higher payment and want to minimize interest, a 15-year mortgage saves significant money. If you need lower payments or want to invest the difference, a 30-year mortgage provides flexibility. Use our mortgage calculator to see the exact numbers for your situation.
Frequently Asked Questions
How much can I save with a 15-year mortgage?
On a $300,000 loan, you could save over $200,000 in interest by choosing a 15-year term over a 30-year term, even accounting for the lower rate on the 15-year loan.
Can I pay off a 30-year mortgage early?
Yes, most mortgages allow extra payments without penalty. You can make extra principal payments to pay off a 30-year mortgage faster while keeping the flexibility of lower required payments.
Which mortgage is easier to qualify for?
A 30-year mortgage is typically easier to qualify for because the lower monthly payment results in a better debt-to-income ratio.