Because of its higher payment, the buyer might be limited to a more modest house than they would be able to buy with a 30-year loan.
With the same example mentioned above, if the mortgage lender will only approve a maximum of $1,500 per month.
The borrower would need to buy a house that is cheaper a $200,000 mortgage at 4%, for 15-years, turns out for a payment of $1,479.
Whereas a 30-year loan would result in a $1,194 monthly payment that is under the $1,500 limit approved by the lender, the 30-year loan might allow the borrower to buy a larger home or take on a bigger mortgage.
So a 30-year mortgage for a $300,000 home would cost $1,432 per month, which too is under the $1,500 maximum and allows you to take on a larger loan by getting a bigger home or a better location.