Many people who are looking to buy a home consider whether a 30 year
or 15 year fixed mortgage rate is best for their monthly payments. A
large number of people nowadays have decided to wait and are buying
homes later but they also want to pay off their mortgage early. It may
take some time to reach a decision as there are many things to
contemplate. Over the period of the loan, it's important to remember to
make sure the interest rate remains the same.
If you are offered a deal that appears to be too good to be true than it
probably is. For loans that have 15 year fixed mortgage rates, the same
amount of interest is maintained throughout the life of the loan. This
is of great benefit for anyone that does not like surprises. When my
wife and I were looking at homes for sale we decided to check out the
various loans available with 15 year fixed mortgage rates.
Our aim was to pay of the mortgage as soon as we could without getting
into trouble with high monthly payments. As well as thinking about loans
of 15 years, we also considered fixed rate mortgages that lasted 30
years as well. Because we didn't still want to have a mortgage close to
retirement, we hoped we would be able to afford a shorter 15 year fixed
rate mortgage. There was obviously very good reasons to finish paying
the loan off early.
We thought about it long and hard and despite the pressure we decided to
go with the 30 year loan plan. Although a number of things had to be
pondered over, eventually the choice was made for us. The main reason
was that I found out my wife was pregnant. My wife was going to raise
our child from home so her addition to the monthly income would be
restricted. Unfortunately, a higher monthly payment was the downside for
loans with a 15 year fixed mortgage rate. For us it just wasn't feasible
as we would just be in over our heads. After looking at the much lower
amount we would be paying per month with a 30 year mortgage loan, there
wasn't any option but to go with it.
We found that if we could make a few extra payments throughout each year
then it would gradually reduce the principle sum owed. By doing this you
can also reduce the term of the mortgage by quite a few years. It may be
easier said than done, but this approach does pay off eventually. Our
desire for a 15 year fixed rate mortgage was second place to our more
immediate needs. All things considered, it all worked out for the best
in the end.
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