The standard home mortgage loan term seems to be about 30 years. However, if you have the ability to make higher payments, you may find advantages to getting a shorter mortgage loan term, such as a 20-year mortgage or even a 15-year home mortgage. These shorter terms may come with higher monthly mortgage payments, but they have the potential to save you a great deal of money in the long run.

Advantages to a 15-year home mortgage

There are plenty of advantages to having a shorter mortgage loan term. One of them is that a shorter mortgage loan term usually comes with a smaller interest rate. And since you will be paying interest over a shorter period of time as well, the savings can move into the thousands of dollars. Additionally, you will build equity in your home faster with a 15-year home mortgage, or even a 20-year home mortgage.

Unfortunately, the payments on a 15-year home mortgage are also higher. And, while you will ultimately save money over the life of your loan, many people cannot afford the higher payments. Others opt to compromise with the 20-year mortgage, or set up bi-weekly payments on a 30-year home mortgage. You should also be aware that you won’t have as high a tax advantage, since your interest rate charges will be so much lower. However, if you have a higher income, or if you are interested in building equity quickly and can stomach the payments, a 15-year home mortgage might be right for you.

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15-year home mortgage, home mortgage terms, mortgage term, 20-year mortgage