15-Year vs 30-Year Mortgage: What Changes?
Mortgage term changes the payment schedule, total interest, and speed at which principal is repaid.
How the math works
Halving the term roughly doubles the required payment for the same loan amount and rate, because the same principal is repaid over half the time — but the total interest paid drops far more than proportionally, since less time means less balance outstanding for interest to accrue against.
Worked example
A $300,000 mortgage at 6.5% costs about $2,022/month over 30 years, with total interest of roughly $427,920. Over 15 years, the payment rises to about $2,613/month, but total interest drops to around $170,340 — less than half.
What to watch for
- 15-year mortgages typically carry a lower rate than 30-year loans, which compounds the interest savings further
- The higher required payment on a 15-year term reduces monthly cash-flow flexibility, which matters for emergency funds and other goals
- Some borrowers choose a 30-year term but voluntarily pay extra principal to approximate a 15-year payoff, keeping the flexibility of the lower required payment
Practical takeaway
Compare both the monthly payment you can comfortably afford and the total interest saved — a 15-year term saves substantially more in interest, but only if the higher payment is genuinely sustainable.