Pay off your home loan fasterPut more money toward your principalPredictable monthly payments
Enjoy a consistent monthly payment for 15 years with no surprises.
Own your home “free and clear” in only 15 years vs. a 30-year mortgage.
Pay less in interest over the life of your loan—the money costs less to borrow.
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See your best loan options with technology that analyzes your finances in real time.
Pick the right loan and term that helps you achieve your unique homeownership goals.
Get approved and funded quickly, so you can enjoy your new financial freedom.
See your best loan options with technology that analyzes your finances in real time.
Pick the right loan and term that helps you achieve your unique homeownership goals.
Get approved and funded quickly, so you can enjoy your new financial freedom.
A 15-year fixed-rate mortgage trades a higher monthly payment for a lower interest rate, so you pay dramatically less interest over the life of the loan.
A 15-year fixed-rate mortgage payment is roughly 50% higher than the 30-year on the same loan amount. Make sure the higher payment fits your budget before committing.
15-year rates typically run below comparable 30-year rates for the same borrower. A lower rate means you’re borrowing the money at a lower cost (but you’re paying it back faster).
Standard purchase or refinance closing timelines apply, typically 30 to 45 days from application to keys or payoff.
Pay the same loan amount every month for 15 years (excluding taxes and insurance), with each payment putting significantly more toward principal than a 30-year would on the same balance.
On the same balance, a 15-year mortgage typically costs less than half the total interest of a 30-year mortgage, and you own your home outright much sooner.
Shorter terms aren't right for everyone, but for the right borrower, they're one of the most efficient ways to build wealth through homeownership.
A 15-year mortgage taken in your 50s can be paid off before retirement income kicks in, freeing up cash flow at exactly the right time.
Households with strong, stable income can absorb the higher payment and capture both the rate savings and the interest savings.
Borrowers years into a 30-year mortgage who refinance to a 15-year often see similar payments to before without restarting the clock.
Borrowers who prioritize paying down secured debt fast and redirecting the freed-up payment to retirement or other goals.
Qualifying for a 15-year mortgage uses the same standards as any other purchase loan, but the higher payment changes what you can afford.
620+ for conventional; higher scores unlock better rates. Above 740 typically sees the lowest available rates.
43–50% maximum, calculated using the higher 15-year payment. This is often the binding constraint.
Same options as 30-year: 3% (some conventional), 3.5% (FHA), 5%+ (conventional), 20% to skip PMI.
For example, recent paystubs and a two-year employment history; self-employed borrowers provide tax returns instead. Asset documentation rounds out the file.
Both fix your rate for the full term, but the 15-year trades a higher monthly payment for dramatically less interest over the life of the loan.
The 15-year mortgage is the cheapest way to own your home outright, but it requires room in your budget that not every buyer has.
15-year rates typically run 0.5% to 0.75% lower than 30-year rates for the same borrower.
Total interest can be less than half of what you'd pay on a 30-year mortgage with the same balance.
After 5 years on a 15-year, you'll own much more of your home than after 5 years on a 30-year.
Every payment automatically builds wealth in a major asset.
Paid off in 15 years instead of 30; meaningful for retirement planning.
Significantly more cash out the door each month than the same balance on a 30-year.
Less room for emergencies, investments, or unexpected costs.
The extra dollars going toward principal aren't earning returns elsewhere; some borrowers do better with a 30-year and invested difference.
The higher payment means a higher DTI calculation; you may qualify for less house.
If rates fall significantly later, you've already locked in your shorter term.
A 15-year fixed-rate mortgage is a home loan that you pay back over 15 years at a fixed interest rate that stays the same from closing to the last payment. This means your equity grows faster and you pay less interest overall. Continue Reading...
There are two ways to save money: pay off your loan faster or get a lower interest rate. Most of the time, lenders charge less for loans that last 15 years than for loans that last 30 years. If you pay a lower interest rate for 15 years instead of 30 years, you can save a lot of money, often in the six figures, on a standard loan amount. The exact difference depends on your rate and balance, but the shorter term always has a big structural advantage.
Expect your monthly principal and interest payments to be about 40–50% higher if you take out a 15-year loan instead of a 30-year loan for the same amount of money. The exact difference depends on the rate spread between the two products when you lock in, but the higher payment is because you are paying it back in half the time. That said, a smaller part of each payment goes to interest and a bigger part goes to building equity. So, a larger portion of every dollar you spend lowers your loan balance.
Lenders have less risk with a shorter loan term because they only have to deal with the chance of default and changes in interest rates for half as long. A lower rate means that there is less risk. Depending on the market, the difference between a 15-year and a 30-year fixed rate is usually between 0.25 and 0.75 percentage points. This rate benefit, along with the shorter time to pay off the loan, is why a 15-year loan saves a lot of money in interest.
A 15-year term is good for people who can afford the higher monthly payment without giving up their retirement savings, emergency funds, or other important financial goals. It works especially well for homeowners who are refinancing after building up a lot of equity, families with two incomes and stable earnings, and buyers who want to pay off their mortgage debt before they retire. A 30-year loan with extra payments might give you more financial freedom if the higher payment would make it hard for you to save up for things you need.
With a 15-year term, you can't pay more when you have the money and less when you don't. The trade-off is discipline: most borrowers don't always make those extra payments, so they end up paying a lot more interest over the full 30-year term. The 30-year loan will also have a higher interest rate, so even with extra payments, the math doesn't fully close the gap unless you are aggressive and consistent about it.
Yes, but you need to change the rate and term. You would get a new 15-year loan to pay off the rest of your 30-year mortgage. This makes the most sense when your income has gone up enough to easily handle the higher payment or when interest rates have gone down. Keep in mind that refinancing costs money to close (closing costs); usually 2–5% of the loan balance. This means that the savings on interest need to be more than the costs of the move up front for it to make sense financially.
The worst part is that cash flow goes down. You have less money to invest, pay for unexpected costs, or save for things like education or retirement accounts that are important to you. Some borrowers can also get a smaller loan with a 15-year term because lenders look at the higher payment when deciding how much debt you can afford. If you lose your job or have a big bill to pay, the fixed higher payment is a lot more to handle than that of a 30-year mortgage.
