🗓 Should I get a 15 year or 30 year mortgage?
Intro
Choosing between a 15-year and 30-year mortgage is a major financial decision. A 15-year term builds equity faster and saves tens of thousands in interest, but the 30-year offers lower payments and the chance to invest the difference. This calculator compares both paths to see which strategy builds more wealth over three decades.
🏠 Loan Details
The CFPB notes that shorter loan terms generally save you money overall but carry higher monthly payments. You borrow and pay interest for a shorter time, and the 15-year interest rate is usually lower—by as much as a full percentage point.
However, a 15-year loan locks you into that higher payment. If money gets tight, you cannot easily shrink a 15-year payment. The 30-year offers flexibility, as you can always pay extra when you want.
📈 Investing Strategy
If you take the 30-year loan, you could invest the monthly payment savings. If your expected investment return outpaces your mortgage rate, the 30-year path might actually leave you richer after three decades.
This comparison assumes steady investment returns and ignores taxes on gains or the mortgage-interest deduction. It also assumes you have the strict discipline to invest the difference every single month without fail.
🔗 See Also
For further related reading, check out:
📊 Results
15-Year Payment
30-Year Payment
Interest Saved
15-Year Wealth
30-Year Wealth
Net Advantage
Verdict
15-year
Calculator updated by heyfinfam (v26.7.0) · View history
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Disclaimer: This content and any calculations provided are for informational purposes only. The views, calculations, and methodologies expressed are those of the author and do not necessarily reflect those of this platform. Not financial advice. Users are solely responsible for any decisions made based on this information.
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