15 Year fixed rate

Loan Type:

Definition:

The interest rate and principle and interest payments do not change over the 15 year repayment period.

Benefits:

Typically you can obtain a lower interest rate than the 30 year fixed rate loan, plus less interest is paid because the loan is paid off sooner. Another benefit is that the equity in your home is built up quicker because you are amortizing your loan over a shorter period.

Drawbacks:

You will have higher monthly payments.

Note:

This loan is a good option for people who can manage the higher payments and want the shorter pay-off time.