This loan is a great choice for the financially savvy customer because it enables you to:
Wondering just how much lower your payments will be on a 30-year fixed mortgage compared to a 15-year fixed?
See our sample loan comparison at the end of this page.
When you obtain a 30-year fixed rate loan to buy your home or refinance, you’ll make monthly payments based on the interest rate and principal loan amount.
Each monthly payment you make will pay down a portion of your loan balance, which includes interest and principal. As time goes on and your payments lower the balance of your loan, the total cost of interest will also go down.
As a result, an increasingly large proportion of your monthly payment will go towards the loan’s principal.
Compared to a 15-year fixed, you’ll pay more interest over the life of your 30-year fixed rate mortgage. This is because, on a 30-year fixed, the money you borrow accrues interest over a longer time period and, generally, at a higher rate.
However, while the interest rate and total amount of interest you pay will be higher, your payments will generally be much lower than they would be with a 15-year fixed rate mortgage.
Depending on the size of your down payment (if you’re buying a home) or the amount of equity you have (if you’re refinancing), you may need mortgage insurance.
This chart shows just how much lower your monthly payments will be with a 30-year fixed rate mortgage compared to a 15-year fixed rate mortgage.
15-Year Fixed Rate vs. 30-Year Fixed Rate | ||
---|---|---|
Loan Type | 30-Year Fixed | 15-Year Fixed |
Loan Amount | $400,000 | $400,000 |
Rate/APR | 4.25% | 3.50% |
Monthly P&I Payment | $1954.44 | $2859.53 |
Total Interest Cost | $308,393.36 | $114,715.50 |
We’re here to help. So if you’re not sure which mortgage is right for you, contact us to schedule a free consultation.
Or, if you’re ready to go, click on the button below to request a quote and we’ll get back to you shortly.
(888) 273-8734 | salomon@theMTGhub.com | 5882 Bolsa Ave Suite 250. Huntington Beach, CA 92649
(888) 273-8734 | salomon@theMTGhub.com | 5882 Bolsa Ave Suite 250. Huntington Beach, CA 92649
(888) 273-8734 | salomon@theMTGhub.com | 5882 Bolsa Ave Suite 250. Huntington Beach, CA 92649