Compare current 15-year mortgage rates
How does a 15 year mortgage work?
A 15-year home loan is a fixed rate loan amortized over 15 years. While your monthly payment will never change, the amount going towards your principal (the amount you actually borrowed) will increase over time. At the same time, the amount spent on interest will decrease.
The 15 year mortgages are an alternative to the more popular 30 year mortgage. Loans amortized over 15 years carry much lower total interest charges. This is because you are paying interest half the time. Another contributing factor: the annual percentage rate (APR) associated with a shorter loan term is generally lower. But because you pay off your loan in half the time, the monthly payments are much higher.
The good news is that your interest rate and payment will never change during the life of your loan. This is because 15 year mortgage rates are fixed rate loans. You will know in advance when you will borrow, exactly when you are debt free and what your total costs will be.
How to compare 15-year mortgage rates
Fifteen-year mortgages are offered by banks, online lenders, and credit unions. Mortgage brokers (who gather your financial documents and connect you with lenders) can also help you apply. The rates and the lender’s requirements vary. Borrowers should get quotes from several mortgage lenders. As you watch, keep an eye out for lenders that allow you to pre-qualify. This allows you to get a quote without a thorough investigation, which will lower your credit score slightly.
Be sure to compare mortgage rates and terms only to other 15 year mortgages. It is important to consider the interest rate, points (prepaid interest), loan origination fees and costs, and eligibility conditions when comparing 15-year mortgage rates. . Also pay attention to the annual percentage rate (APR) of each loan. This number expresses the total annual cost of the loan taking into account both fees and interest. It can help you easily see the big picture when you compare one loan to another.