Mortgage comparison: 15 year vs 30 year

Determining whether to finance for 15 year or 30 year can be challenging.  With a 15 year mortgage you will pay significantly less interest, which is desirable for obvious reasons.  But that is only if you can afford the higher monthly payment.  A 30 year term will allow you to afford more home.  It depends on what is more advantageous for you personally.

Example:  $200,000 morgtgage

Interest rate for 15 years  4%

Interest rate for 30 years 4.5%

15 year monthly payment:  $1,479

30 year monthly payment:  $1,013

15 year term saves you $98,526 in interest but costs $466 more per month.

Weigh the options carefully before making a decision.