15 Year Mortgage

This is one of the more well known Fixed Rate Mortgage options and is actually the second most popular type of fixed rate loan. As its name indicates it is amortized at a term of 15 years. This means that the interest rate and monthly mortgage payments will not change at any point during those 15 years. At the end of 15 years (which is 180 months) the entire balance of your mortgage will be paid in full and you will own your home 'free and clear'.
  Most lenders offer the 15 Year Mortgage at an interest rate that is below that of the 30 Year Term. So when you get a 15 Year Term you save big by having a lower interest rate and by paying interest for 15 less years. Over the life of your mortgage these savings can be huge.
  Here's a comparison: The payment on a $150,000 loan with a 30 Year Term and a rate of 6.25% id $924 a month and costs $334,487 over the life of the loan. The 15 Year Term for this $150,000 loan would have a lower rate (in this case about 5.75%) and have a monthly payment of $1,246 and would cost $224,211 over the life of the loan. The savings in this example would be over $110,276 by selecting a 15 Year Mortgage.

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