15 Year Mortgage, Is It Right For You!
When considering their monthly repayments, many people considering buying a home look into 30 year or 15 year fixed mortgage rates. No-one wants a mortgage hanging around their neck forever but with home buyers entering the market later, an early repayment of this loan is important. It may take some time to reach a decision as there are many things to contemplate. Ensuring the repayment remains the same throughout the mortgage term is very important.
It is always wise to avoid agreements that do not appear to have any negative aspects because they invariably have but are hidden. Interest rates should remain the same throughout the life of the loan for 15 year fixed rate mortgages.
There are no hidden costs involved with this type of plan which is great for many people that want a regular monthly payment. When we were looking to buy a home, my wife and I decided to go for a loan with a 15 year fixed mortgage rate.
Our aim was to pay of the mortgage as soon as we could without getting into trouble with high monthly payments. So in consideration of this point we also looked at longer, 30 year fixed rate mortgages as well.
Still, having a mortgage close to retirement was not what we were looking for, so we decided to try for a loan with a 15 year fixed mortgage. There was obviously very good reasons to finish paying the loan off early.
After taking everything into consideration we decided on a 30 year loan instead. There were many things that factored into this decision. Finding out my wife was having a baby made making the choice so much easier!
My wife decided she wanted to raise our child at home so I could not be certain of her monthly financial commitment to our household expenses. The downside to the 15 year fixed mortgage rate was the higher monthly repayment. We just decided we would probably get into trouble if we took this route. A thirty year loan brought the monthly payments down to a reasonable level.
We are also able to make extra payments throughout the year to make the principal shrink quicker. It is possible to take years off your loan if you can make a few extra payments during each year. It may be easier said than done, but this approach does pay off eventually. Our first choice would have been to go for the short term 15 year fixed rate mortgage solution but this did not help with our more immediate situation. In retrospect, everything worked out great for us by going down this road.
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