Is the interest rate on a 15-year mortgage always lower?

No — usually, but not always. The gap between 15-year and 30-year rates has been thin for years and occasionally inverts, so ask for both quotes on the same day. On a $320,000 loan the difference between 6.5% and 6.0% over 15 years is $2,788 versus $2,700 a month and roughly $16,000 of interest.

Is a 15-year mortgage worth it if I might move in five years?

It can be, but you are paying for it in cash flow. Over five years the 15-year borrower pays about $45,900 more than the 30-year borrower while retiring about $54,100 more principal — roughly $8,200 ahead on paper, and $765 a month poorer in the meantime.

Can I get 15-year results from a 30-year loan?

Yes. Pay the 30-year payment plus the difference — $765 on a $320,000 loan at 6.5% — and the loan retires in the same 15 years with the same interest, as long as the servicer applies the extra money to principal. You keep the right to drop back to the required payment when money is tight.

Does the term affect anything besides the payment and interest?

Indirectly, yes. Faster principal paydown reaches the 80% loan-to-value line sooner, which is where PMI cancellation lives — the PMI Calculator shows how many months that takes on your numbers. A shorter term also means a smaller approved loan for the same income. Property tax and insurance are the same either way, and the calculators here cover principal and interest only.

Which term do most American buyers choose?

The 30-year fixed remains the default for most purchases because it is the version a first-time budget qualifies for. Fifteen-year loans are chosen mainly by buyers with larger down payments or higher incomes, and refinancing can move you between the two later.

15-Year vs 30-Year Mortgage

5 min read · updated October 5, 2026

Ask two people which term they chose and you will get two confident answers. The 15-year and the 30-year are the two default products in the American mortgage market, and each comes with an argument that sounds decisive: one saves a fortune in interest, the other leaves money in your pocket every month.

Both claims are true, which is why this is a cash-flow decision wearing the costume of an arithmetic decision. Here are the actual numbers on one loan, so you can see which constraint you actually live with.

The payment gap is bigger than it sounds

On a $320,000 loan at 6.5%, the Mortgage Payment Calculator prices the 30-year at about $2,023 a month, the 25-year at $2,161 and the 15-year at $2,788. That is $765 more every month, roughly 38% higher, and on a $400,000 loan the same comparison opens the gap to $956. Very little else you can change after you sign moves a payment that much — apart from the balance itself.

Where the interest actually goes

Over the full term that $765 buys something real. The 30-year costs about $408,000 in interest; the 15-year costs about $182,000, so you save roughly $226,000 — about 55% less interest. The saving is not spread evenly, though. After five years a 30-year borrower has retired only about $20,400 of principal while the 15-year borrower has retired about $74,500, and after ten years the figures are $48,700 against $177,500. An amortization schedule shows this month by month, and it is why people who move early feel cheated by a 30-year loan when nothing actually went wrong.

Do not assume the 15-year rate

Textbooks say a 15-year mortgage carries a lower rate, and it usually does. But the spread between the two has been thin for years and occasionally inverts, so treat half a point as a question for your lender rather than a fact. When the discount is there it is worth real money: the same $320,000 at 6.0% over 15 years prices at $2,700 a month with about $166,000 of interest instead of $182,000.

The same budget buys you less house

Term also decides what a lender will approve. At a $2,023 monthly payment the 30-year supports a $320,000 loan; the 15-year supports roughly $232,000 — about $88,000 less house for exactly the same cheque. Put your own income into the How Much House Can I Afford Calculator before you fall for a 15-year you cannot qualify for.

The trick that gets you both

A 30-year loan with a regular extra payment can imitate the 15-year. Add $765 to the 30-year payment and the loan retires in 15 years with the same interest paid — while the required payment stays at $2,023, ready to fall back on when income dips or a new child arrives. The Mortgage Payoff Calculator gives you the earlier payoff date and the interest saved. One caveat that decides everything: it only works if the servicer applies the extra money to principal, which is worth confirming in writing rather than assuming.

The middle ground nobody mentions

Twenty-five years is the quiet compromise. It prices at $2,161 a month — only $138 more than the 30-year — and cuts roughly $80,000 of interest. It sits on the useful part of the curve, which is why it is the default term across the calculators on this site.

So which one?

Take the 15-year if the payment is comfortable without straining, you intend to stay put, and you would rather be forced to save than trust yourself to. Take the 30-year and invest the difference if cash flow matters more than lifetime interest, if there is a real chance you move within a few years, or if you have somewhere better to put $765 a month. If the bigger question is whether owning beats renting in your city at all, settle that first with the Rent vs Buy Calculator.

Once the term is settled

The term is one decision, not the last one. What you can still do about the payment on a loan you already have — PMI, escrow, recasts and the break-even test before refinancing — is the subject of how to lower your monthly mortgage payment.