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There are three primary advantages of a 15-year mortgage loan versus a standard 30-year loan.
Interest Rate 5.50% 15 yr. 5.75% 30 yr.
Payment $1,634.17 15 yr. $1,167.15 30 yr.
Pmt. Difference $467.02 (40% Higher then 30-year)
Interest Cost $94,150.60 15 yr. $220,174.00 30 yr.
Interest Savings $126,023.40
As you can see, you could save a huge amount of interest, real money, by using a 15-year mortgage loan instead of a 30-year product. If you're going to keep your property for a longer period of time (over five years), you should give a 15-year mortgage serious consideration if you can afford the higher payment.
|Jennifer Mathes, Ph.D.|