Buying a home is a big investment. It will take you years to pay off the loan you use to buy the property. That is why it is so important for you to consider all loan options that could fit your unique needs. One of those options is the 15-year mortgage. This mortgage length is used in only about 20 percent of all mortgages issued in the United States. It provides an individual with the ability to buy a home and pay it off within 15 years. Before securing this loan, customers should consider a few key factors.
Determine the Affordability
There are several good things about a 15-year mortgage. If the loan is only 15 years, that means there is a significantly smaller number of years for the interest to apply to it. This means that the loan is more affordable in the long term. Over those 15 years, you will pay less interest than if you secured the more commonly used 30-year term.
However, for some people, this may not be ideal. A 15-year mortgage will mean there is less time for the principle to be spread out. This means that monthly mortgage payments will be higher. If you can afford to make these payments, though, this type of loan can still be an ideal investment for you.
It is worth speaking to your lender about each of your options. Compare what they will mean to you now and later. For those who can afford the 15-year mortgage – and who take the time to compare rates carefully to find the best option – this loan can be an ideal investment overall. It can keep costs in line while also ensuring that borrowers pay off a loan quickly.
A good 15-year mortgage may be the answer, go to Guaranteed Rate for options.
