Many couples buying a home are face with the question of whether to opt for a 15 or 30 year fixed mortgage rate. Early completion of a mortgage is important for those of us that leave buying a home until later in life. In a situation as important as this, time needs to be spent considering all the available options. One point to remember is ensuring that your monthly mortgage repayment remains the same throughout the entire period of the loan.
If you are offered a deal that appears to be too good to be true than it probably is. A fixed rate mortgage maintains a set interest rate during the period of the loan. If you are someone that wants a loan with a regular fixed repayment and no additional charges then this is the main benefit with this type of agreement. Both my wife and I decided to research fixed rate mortgages when we started looking at homes for sale.
It was always our intention to clear our mortgage debt as early as we could but we did not want to over extend ourselves at the same time. When we considered fixed rate mortgages we also looked into even longer term loans that spanned 30 years as well. Still, having a mortgage close to retirement was not what we were looking for, so we decided to try for a loan with a 15 year fixed mortgage. We felt that there was a great deal of emphasis on paying the mortgage off early.
Eventually we decided on a 30 year loan after looking at all the other possibilities. There were many things that lead us into making this choice.Discovering my wife was having a baby was the most important reason. The contribution my wife made to the monthly finances would be unreliable since she intended to raise our child at home.
The contribution my wife made to the monthly finances would be unreliable since she intended to raise our child at home. Loans that were based on 15 year fixed mortgage rates required a much higher monthly payment. We just decided we would probably get into trouble if we took this route. Despite the trepidation of having a longer term loan, it did reduce the repayments considerably.
Being able to make additional lump sum payments during the year means the outstanding loan reduces faster. By doing this you can also reduce the term of the mortgage by quite a few years. This takes some discipline but it is well worth the effort it in the long term. It was hard going against our preference for a shorter term, 15 year fixed rate mortgage, but we had to think about more immediate needs and abilities. As it is, things worked out very well for us by taking this route. - 16928
If you are offered a deal that appears to be too good to be true than it probably is. A fixed rate mortgage maintains a set interest rate during the period of the loan. If you are someone that wants a loan with a regular fixed repayment and no additional charges then this is the main benefit with this type of agreement. Both my wife and I decided to research fixed rate mortgages when we started looking at homes for sale.
It was always our intention to clear our mortgage debt as early as we could but we did not want to over extend ourselves at the same time. When we considered fixed rate mortgages we also looked into even longer term loans that spanned 30 years as well. Still, having a mortgage close to retirement was not what we were looking for, so we decided to try for a loan with a 15 year fixed mortgage. We felt that there was a great deal of emphasis on paying the mortgage off early.
Eventually we decided on a 30 year loan after looking at all the other possibilities. There were many things that lead us into making this choice.Discovering my wife was having a baby was the most important reason. The contribution my wife made to the monthly finances would be unreliable since she intended to raise our child at home.
The contribution my wife made to the monthly finances would be unreliable since she intended to raise our child at home. Loans that were based on 15 year fixed mortgage rates required a much higher monthly payment. We just decided we would probably get into trouble if we took this route. Despite the trepidation of having a longer term loan, it did reduce the repayments considerably.
Being able to make additional lump sum payments during the year means the outstanding loan reduces faster. By doing this you can also reduce the term of the mortgage by quite a few years. This takes some discipline but it is well worth the effort it in the long term. It was hard going against our preference for a shorter term, 15 year fixed rate mortgage, but we had to think about more immediate needs and abilities. As it is, things worked out very well for us by taking this route. - 16928
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