15-Year Fixed-Rate Mortgage
Build equity faster with a lower rate and pay off your home in half the time.
Overview
A 15-year fixed-rate mortgage offers a lower interest rate (typically 0.5-0.75% less than a 30-year) and cuts total interest paid roughly in half. Monthly payments are significantly higher, but you build equity much faster and own your home free and clear in 15 years. This is popular with refinancers, high-income buyers, and those approaching retirement who want to eliminate their mortgage payment.
Min. Down
3%
Min. Credit
620
Term
15 yr
PMI
Yes*
Best For
- Refinancers looking to pay off sooner
- High-income buyers
- Buyers approaching retirement
- Those who want to minimize total interest
Pros
- Lower interest rate than 30-year loans
- Pay roughly 50-55% less total interest
- Build equity significantly faster
- Own your home free and clear in 15 years
- Lower rate means faster PMI removal
Cons
- Monthly payment is 40-50% higher than 30-year
- Less financial flexibility
- Smaller loan amount may qualify for
- Higher DTI makes qualification harder
Requirements
- Minimum 620 credit score (conventional)
- Maximum 43% debt-to-income ratio recommended
- Stable employment history (2 years)
- Down payment of at least 3%
- Property appraisal