Let me preface this article by saying that if you are indeed thinking on dumping your 30 year mortgage for the 15 year variety, you need to make sure you do your research and are committed to your new loan. There many Reasons To Consider 15 Year Mortgage and this article will highlight 3 of these reasons and try to give you a lot of insight in what it takes to thrive with a 15 year mortgage as well as the benefits involved. If it is possible for you to cut your repayment time in half and save thousands upon thousands of dollars in interest paid, would you do this? Most people would jump at the opportunity to take on a 15 year mortgage, but it definitely isn’t for everyone. The following Reasons To Consider 15 Year Mortgage will play a vital role in your decision making.
As just mentioned, one of the main advantages for a 15 year mortgage, if you can afford it, is the amount of money you will save over the course of the loan versus a 30 year mortgage. Let’s look at the numbers and you can see exactly what I mean. For these calculations, let’s factor in a $200,000 mortgage at a 4% interest rate calculating principal and interest. If you were to make all your payments for a 30 year loan, you would end up paying $343,739 for your $200,000 loan. On the flip side, the 15 year loan would only require paying $266,288 over the course of the loan. The 15 year mortgage will end up saving you over $75,000 AND your loan is paid off in half the time. If you can afford the higher payment of $524 per month, this would work for you.
If you plan on retiring in 20 years or less or want to get a jump start on your life after retirement then a 15 year mortgage may be the right choice for you. In getting or refinancing into a 15 year mortgage, you can rid yourself of a mortgage for your retirement years and focus more on living expenses and travel. If you are still 20+ years from retirement, this can allow you to get rid of your mortgage payment in plenty of time before retirement and allow for even more savings to be had. Getting rid of your mortgage payment can do wonders for your cash flow in retirement.
If you take the recent market trends with regards to home prices, it is no secret that home prices are on the rise, so what better way to maximize your return than by getting your house paid off sooner and your value increasing. With a 15 year mortgage, you are developing equity twice as much every payment than with a 30 year loan and if your home is appreciating in value it’s like a win-win situation. When the time is right you can downsize your home and buy something cheaper and smaller with a nice chunk of change left over to invest.
As you can see by reading the reasons I outlined, taking on a 15 year mortgage isn’t for everyone and if you have ambitions on refinancing into a 15 year mortgage then to start with you can always treat your existing 30 year loan as if it were 15 years. You can always calculate the equivalent 15 year payment and pay that amount for 3-4 months. If your finances aren’t affected tremendously by this, then you shouldn’t have an issue refinancing into a 15 year mortgage. If you are looking to deal with a professional in refinances and 15 year mortgages, you need to contact me today and we can go over your entire situation. If this isn’t the right program for you, we won’t do the loan, but it is always wise to see your options. Feel free to call me any time at 888-900-1020, email me at firstname.lastname@example.org, or visit www.loanconsultants.org.