Whether refinancing or purchasing a new home, with rates at historical lows it’s worth running the numbers on the 15-year fixed mortgage. The 15-year fixed mortgage, offers a lower rate than the 30-year fixed mortgage with 15 fewer years to pay it off. Payments may be similar or in some cases even lower then the 30 year monthly payment and over the life of the loan you save a substantial amount in mortgage interest costs. With these huge savings a homeowners can easily plan for retirement or save for college tuition costs.
Lets take a closer look at the 3 key advantages of the 15-year fixed:
1. Less interest paid
A 15-year fixed rate mortgage will accrue less interest then a 30-year fixed simply because it has less time to accumulate the interest.
2. Retirement advantages
Pay off loan faster in order to prepare for retirement and have little to no debt on home.
3.Building equity faster
Accruing equity in your home affords you the opportunity to obtain a home equity line of credit and/or a home improvement loan.
Ask yourself these 2 important questions:
1. Are you planning to retire in the next 15 years?
No monthly mortgage payment provides peace of mind, freedom and a sense of financial security.
2. Is a 15-year mortgage right for you?
In some cases the 15-year mortgage payment is equal to or lesser than a 30-year mortgage obtained 3 years ago!
I would enjoy talking with you about the pros and cons of refinancing. There are numerous scenarios where it does not make sense to refinance, however, a simple call to review your options will provide you with a peace of mind.
*Please visit our Disclosures page for more details for all loan types.
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