The monthly repayments for 30 year or 15 year fixed mortgage rates are just one important consideration for many people who are looking to buy a home. Buying a home later in life means that many people want to have the mortgage paid off early. Of course, there are many things to consider before agreeing to anything. Home buyers looking into this need to be assured their monthly payments will not increase.
If you are offered a deal that appears to be too good to be true than it probably is. Loans agreed with a 15 year fixed mortgage keep the same interest rate throughout the entire life of the agreement. For those individuals that do not like hidden surprises, this is always a benefit. My wife and I looked into the loans available with 15 year fixed mortgage rates when we were searching for a home 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. It became obvious that we had to look at fixed rate mortgages over a longer period and not just 15 year plans. No-one likes the idea of having a mortgage when they are close to retirement, and we were no different, so it was still our hope that a 15 year fixed mortgage rate plan would still be an option. There was a lot of pressure to have the house paid off as soon as possible.
Eventually we decided on a 30 year loan after looking at all the other possibilities. Reaching the decision we did was the only one that made sense. It was easier reaching this conclusion when I learnt my wife was expecting a baby. Her regular monthly income would become unreliable because she wanted to be at home raising our child. The downside to the 15 year fixed mortgage rate was the higher monthly repayment. We just decided we would probably get into trouble if we took this route. The monthly payments on a 30 year loan were quite a bit lower.
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 may be difficult but well worth the effort in the a few years down the line. 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. Despite all our worries, things turned out well for us and we do not regret the decision.
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