What are the advantages of a 15-year versus a 30-year loan term?
With a 30-year loan, often the mortgage payment is smaller and more affordable for many people than a 15-year loan. However, more mortgage interest is paid than mortgage principal, meaning larger tax deductions, but more money is spent over the life of the loan than in 15-year mortgages. A 15-year loan is usually made at a lower mortgage interest rate. Equity is built faster because early mortgage payments pay more mortgage principal.
