<\/span>Cons of a 15 Year Mortgage<\/span><\/h3>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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Even after the interest saved with a 15 year mortgage, borrowers should consider a few disadvantages before plunging into the term.<\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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<\/span>Higher Monthly Payments<\/span><\/h4>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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As the  15-year mortgage loan needs to be paid off in half the time it has a higher monthly payment than a 30-year. <\/p>

For instance, a 15-year loan of $250,000 at 4% interest will have a monthly payment of $1,849 against $1,194 for the 30-year. <\/p>

So the 15-year monthly payment is about 55% higher than the 30-year for the same amount at the same rate.<\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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<\/span>Less Affordability<\/span><\/h4>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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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. <\/p>

With the same example mentioned above, if the mortgage lender will only approve a maximum of $1,500 per month. <\/p>

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.<\/p>\n

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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. <\/p>

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.<\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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<\/span>Less Money Going to Savings<\/span><\/h4>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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The higher payment requires higher cash flow and one year\u2019s worth of income in liquid savings. <\/p>

The higher monthly payment means a borrower would have to let go of the opportunity to build savings or save for goals like college tuition for a child or his retirement.<\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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<\/span>Conclusion<\/span><\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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Like a 30-year mortgage a 15-year mortgage, too is a home loan having the same interest rate and monthly payment for the life of the mortgage. <\/p>

Depending on your financial situation and goals you can decide if you want to opt for a fixed 15-year or 30-year mortgage.<\/p>\n

A homebuyer can save significant money over the length of the loan with a 15-year mortgage because the interest paid is less than in a 30-year mortgage. <\/p>

Refinancing into a 15-year mortgage when you are halfway through your 30-year mortgage, may lower your interest payments while still paying off the loan in the expected amount of time.<\/p>\n

Because in a 15-year loan the payments are significantly higher, if buyers cannot keep up with the payments due to loss of job or change in income they risk defaulting on the loan.<\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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\n\t\t\t\n\t\t\t\t\t\t\n\t\t\t\t\t\tCompare Your Mortgage Quotes Online<\/span>\n\t\t<\/span>\n\t\t\t\t\t<\/a>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

About 15 Year Mortgage A 15-year mortgage is one of the popular loan terms second to a 30-year mortgage. Some borrowers opt for the 15 year mortgage because it saves them a significant amount of… Continue Reading The Pros and Cons of a 15 Year Mortgage – The Expert Overview<\/span><\/a><\/p>\n","protected":false},"author":3,"featured_media":9387,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_newsletter_tier_id":0,"footnotes":""},"categories":[40],"tags":[1704,1703,1702,259,1701,47,48],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"https:\/\/www.compareclosing.com\/blog\/wp-content\/uploads\/2021\/07\/The-Pros-and-Cons-of-a-15-Year-Mortgage-The-Expert-Overview.jpg","_links":{"self":[{"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/posts\/9371"}],"collection":[{"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/comments?post=9371"}],"version-history":[{"count":5,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/posts\/9371\/revisions"}],"predecessor-version":[{"id":9409,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/posts\/9371\/revisions\/9409"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/media\/9387"}],"wp:attachment":[{"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/media?parent=9371"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/categories?post=9371"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/tags?post=9371"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}