What is a better choice a 15 or 30 year mortgage for new home?
Quick question:I am looking to get a new home and I hav a few options.Let me know if this makes any sense (using current interest rates) ......I can get a 180,000 mortgage over 30 years that would cost $175,000 in interest, or a 15 year about $75,000 in interest..The payments for the 15 are $1404 and 30 are $988, the difference is $416 a month......If were to put that extra $416 a month in a savings account at 3.3% interest, in 15 years it will be $96000 dollars, almost making up for the extra $100,000 you spend in interest..... I *think* this make sense but I'm having trouble wrapping my head around if it should count since I have to pay another 15 years after that.....What do you think? by leroyfromtx25 from Houston, Texas. Sep 17th 2009
Joshua Crater (Rate1st.com)
#203 ranked lender in California - 47 contributions
Well the general idea is that you would take that $96,000 out of the bank in 15 years and payoff your mortgage. If you can afford the 15 year fixed payment then I would have to suggest that. In fact if you would be interested we are currently offering a 3.875% on 15 Year fixed with a 3 point buydown, this would make your payment only $1,320 for the 15 Year Fixed and that would save you a huge amount in interest over the term of your loan. If you would like more details please contact us. Toll Free 1-877-728-3178 or Apply online at ww.Rate1st.com
Gene Ayzenshtat (Mortgage Expert)
#1 ranked lender in Massachusetts - 8 contributions
If you can manage 15 yrs fixed options, it always the best option. The rate is lower, thus the interest you will end up paying will be less.
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