15-Year Fixed-Rate Mortgage
A 15-year fixed-rate mortgage allows you to pay off your home in 15 years with an interest rate that remains the same for the life of the loan. Compared with a 30-year mortgage, it typically has higher monthly payments but may offer a lower interest rate, faster equity growth and significantly less interest paid over time.
Frequently Asked Questions
Will my monthly payment stay the same?
Your monthly principal and interest payment will remain the same. However, your total payment may change if property taxes, homeowners insurance or mortgage insurance costs change.
Is the payment higher than a 30-year mortgage?
Yes. Because the loan is repaid in half the time, the monthly payment is typically higher.
Will I pay less interest?
Generally, yes. A shorter repayment period means you will usually pay substantially less interest over the life of the loan.
Will I build equity faster?
Yes. More of your payment goes toward reducing the loan balance, allowing you to build equity faster than with a longer-term mortgage.
Is the interest rate lower?
Fifteen-year mortgages typically offer lower interest rates than comparable 30-year mortgages, although your actual rate will depend on market conditions and your financial qualifications.
Who may benefit from a 15-year mortgage?
It may be a good option for borrowers who can comfortably afford the higher payment, want to become mortgage-free sooner and would like to reduce their total interest costs.
Can I use a 15-year mortgage to refinance?
Yes. Eligible homeowners may refinance into a 15-year fixed-rate mortgage to shorten their repayment period and potentially save on interest. Closing costs and the new monthly payment should be considered before refinancing.
How do I know if it is right for me?
The best loan term depends on your income, monthly budget, long-term goals and how long you plan to own the home. A mortgage professional can compare your options and help you determine which loan best fits your needs.