15-Year vs 30-Year Mortgage: Which Should You Choose?
The loan term is one of the biggest decisions when taking out a mortgage. A 15-year loan and a 30-year loan on the same amount produce very different monthly payments and lifetime costs. Here's how to decide.
The core trade-off
A 30-year mortgage has lower monthly payments but a higher interest rate and far more total interest. A 15-year mortgage has higher monthly payments but a lower rate and dramatically less total interest — often less than half.
- 30-year: lower payment, more flexibility, more total interest.
- 15-year: higher payment, big interest savings, forced discipline.
An example
On a $350,000 loan, a 30-year term at 6.5% costs about $2,212/month with roughly $446,000 in total interest. A 15-year term at 5.8% costs about $2,914/month but only around $174,000 in interest — a savings of more than $270,000, for roughly $700 more per month.
Who should choose a 15-year mortgage?
A 15-year loan suits buyers with stable, comfortable income who want to be debt-free faster and minimize interest. The higher payment reduces flexibility, so it's best when the payment is a manageable share of your budget.
Who should choose a 30-year mortgage?
A 30-year loan suits buyers who value lower required payments and flexibility — for example, to invest the difference, build savings, or weather income changes. You can always pay extra to mimic a 15-year payoff while keeping the option to pay less in tight months.
Ready to run the numbers? Try our Mortgage Calculator.