15 or 30 Years? How to Choose the Right Mortgage Term

Buying a home is an exciting milestone, but it also comes with big decisions that shape your financial future. One of the most important choices you'll make is choosing the right mortgage term. Should you go with a 15-year loan or the traditional 30-year route? It depends. Here's what to consider when weighing your options.

Why Your Mortgage Term Matters

Your mortgage term isn't just about how you'll make payments–it directly impacts:

• Your monthly budget
• How much interest you'll pay over time
• How quickly you'll build equity in your home

A shorter term usually means higher monthly payments but less interest overall. A longer term lowers your monthly cost but stretches your loan out, meaning you'll pay more interest across the life of your mortgage. Carefully considering your options and choosing the right path for you can not only give you peace of mind but also financial stability.

A 15-Year Mortgage

Pros

• Pay off your loan in half the time
• Save tens of thousands in interest
• Build equity quickly, possibly enhancing your financial security

Considerations

• Higher monthly payments, which may stretch your budget
• Less cash flow for other expenses or savings

If you want to build wealth quickly and can comfortably handle higher payments without putting stress on your day-to-day finances, a 15-year term mortgage may be right for you.

A 30-Year Mortgage

Pros

• Lower monthly payments
• Easier to qualify for
• More room in your budget for savings, retirement, or financial goals

Considerations

• Pay significantly more in total interest over the life of the loan
• Slower equity growth

A 30-year term mortgage may be a good fit if you want to keep your payments manageable (especially if you're buying your first home), starting a family, or planning for other major expenses.

Factors to Consider When Choosing Your Term

When deciding between mortgage year terms, think about the following:

Budget

Can you comfortably afford a higher monthly payment without sacrificing essentials? A 15-year mortgage often means higher monthly payments, which can feel overwhelming if you're balancing childcare costs, student loans, or other family expenses. Determine your monthly budget, factoring in essentials like healthcare, groceries, and savings for emergencies.

Goals

Think about the financial goals that matter most to you right now. If your priority is to be debt-free as quickly as possible, a shorter term can help you build equity and achieve financial independence sooner. But if you'd prefer to keep payments smaller so you can contribute to other financial goals, the flexibility of a longer term might suit you better.

Job Security

Your career plays a big role in how comfortable you'll feel with your loan. If you have a steady, predictable income and a high level of job security, you may feel more confident committing to higher payments on a 15-year mortgage. However, if you're just starting in your field or your job involves variable income or frequent contract work, a 30-year loan may give you more peace of mind.

Future Plans

How long do you plan to stay? If this is your "forever home," paying it off sooner could give you more financial freedom down the road. Consider this a starter home and plan to move in a few years? The benefits of paying extra for a shorter term may not be as impactful. Thinking ahead about your lifestyle and housing plans will help you choose the term that makes the most sense.

Find the Right Fit With JustChoice Lending

We're not here to push you into one product over another. Instead, we focus on your unique needs. Whether you're drawn to the faster payoff of a 15-year loan or the lower monthly payments of a 30-year one, we'll walk you through your options, go over long-term mortgage rates and how they impact your budget, and help you feel confident in your choice. Let's get started!