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15 vs 30 Year Mortgage Calculator

Principal:
Interest/15 yr.
%
Interest/30 yr.
%

  15 Year 30 Year
Payment:* $ 912.86 $ 733.76
Interest: $ 64,315.32 $ 164,155.25

*Payment does not include any escrow.

These calculated results are for general illustration only. Taxes, closing costs and other variables will affect actual savings

You will save $ 99,839.93 if you choose a 15-year mortgage at 7.250 percent over a 30-year mortgage at 8.000 percent. But before you conclude that the 15-year mortgage is preferable, consider these points.

  1. How much can you afford to pay toward your mortgage on a monthly basis?

    As a guiding principle, your total housing expense (including mortgage payments) should not exceed 40 percent of your Net Spendable Income--an amount equal to your gross monthly income minus taxes and tithes.
     
  2. If the 15-year monthly payment will fit into your budget and you are confident that your income will not decrease significantly over the 15 year period, a 15-year mortgage may be right for you, but...
     
  3. If your goal is to pay off your mortgage in 15 years and not be contractually obligated to do so, consider paying a little more each month toward the loan principal.

    As an example, suppose you take out a 30-year mortgage at 8.000 percent. Make monthly payments of $955.65 for 15 years ($733.76 regular monthly payment plus an extra $221.89 each month).

    Under this plan, your total monthly payment of $955.65 is only $ 42.79 more than what you would have paid under the 15-year mortgage, but you are not contractually obligated to make the higher payments-- a real advantage if your financial situation in the future limits your ability to pay the higher mortgage payment every month.