At the same interest rate, a 15 year mortgage will require higher monthly payments than a 30 year mortgage. But because you are paying back the loan faster, the total amount of interest paid will be lower for a 15 year loan. The interest rates on a 30 and a 15 year loan may also be different—currently, interest on a 15 year mortgage is lower than on a 30 year mortgage, resulting in additional savings.

TIP: Be sure you can afford the higher monthly payment on a 15 year mortgage! Often the 30-year mortgage may offer more flexibility: you can always make extra payments to reduce total interest paid and shorten the length of the loan but have the option of paying the lower monthly payment if you are strapped for cash in a given month.

Loan Comparison 15 Year 30 Year Monthly Mortgage Payment Number of Payments 180 360 Start Date Pay Off Date Total Interest