Save $100,000 on mortgage interest costs! Sound
impossible? Not really. An old-time mortgage that is once again proving
popular allows homebuyers to so just that. It is the 15-year fixed-rate
mortgage that lets homebuyers own their homes free and clear in 15 years.
And, while the monthly payments are somewhat higher than a 30-year loan,
the interest rate on the 15-year mortgage is usually a little lower, and
importantly - the homebuyer pays less than half the total interest cost
of the traditional 30-year mortgage. The purpose of this page is to help
prospective homebuyers explore the 15-year fixed rate mortgage - a new
option for saving on total mortgage interest costs.
The 15-year fixed rate mortgage offers the qualified consumer five big advantages:
You own your home in half the time it would take with a traditional mortgage.
Lenders usually offer this mortgage at a slightly lower interest rate
than with 30-year loans - typically 0.5 percent to 1.0 percent lower.
It is this lower interest rate added to the shorter loan life that realizes
the savings for 15-year fixed rate borrowers.
15-year mortgages can be insured by the Federal Housing Administration
(FHA) and the Veterans Administration (VA), and with private mortgage
The disadvantages associated with a 15-year rate mortgage are really the qualifiers that will tell consumers if this is the mortgage for them.
The monthly payments for this type of loan are higher than those for a 30-year mortgage, roughly 10 percent to 15 percent higher per month.
Because borrowers pay less total interest on the 15-year fixed rate mortgage, they lose the maximum mortgage interest tax deduction.
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