Should You Buy a Home With a 15-Year Mortgage?

Although 15-year mortgages save lots of money on interest, experts say that due to monthly cashflow limitations, most buyers choose a 30-year mortgage when buying a house.

Juliette Fairley

Published: 7/24/2025, 11:32:16 AM EDT

Should You Buy a Home With a 15-Year Mortgage? — A for sale sign displayed in front of a home in Miami, Fla., on Feb. 22, 2023. (Joe Raedle/Getty Images)

Although 15-year mortgages save lots of money on interest, they also have higher monthly payments.

As a result, due to monthly cash flow limitations, financial experts say most Americans choose a 30-year mortgage when buying a house.

''If I were to craft a new rule about 15-year mortgages, it would be don't just qualify on paper, qualify in real life,” LBC Mortgage founder and CEO Alex Shekhtman told NTD. “A 15-year mortgage shouldn’t just make sense during an ideal month. It should still work when the car breaks down or the water heater needs replacing.”

Some experts advise never taking out a mortgage longer than 15 years, but critics say the advice is increasingly out of touch with today’s high prices, high rates, and stagnating wages, especially for first-time buyers.

For example, the cost difference for a $400,000 home with a 20 percent down payment and under 7 percent interest rate is that a 30-year mortgage would have $446,428 total interest paid compared to $197,725 with a 15-year mortgage.

But the 15-year mortgage is $747 more expensive per month than the 30-year mortgage at $2,876.25 versus $2,128.97.

“The 15-year loan is great for people with stable, high income and minimal debt who are often dual-income families or buyers downsizing,” Shekhtman said. “They’re financially ready to fast-track equity and aren’t worried about locking up more of their monthly cash flow.”

The difference between a 15-year mortgage and a 30-year mortgage is the number of payments, how expensive the monthly payments are, and total interest paid.

A Consumer Financial Protection Bureau study found that it’s typically older mortgage applicants who want a 15-year loan, with just 20 percent of borrowers who are 59 years old and older aiming for mortgages of 30 years or longer.

However, nearly 90 percent of homeowners overall choose a 30-year mortgage, according to Freddie Mac data.

“Closing costs and fees are going to be the same 99 percent of the time for the 15-year and 30-year mortgage,” Echo Fine Properties broker and CEO Jeff Lichtenstein told NTD. “The only difference would be the interest rate, as a 15-year mortgage is usually a lower rate.”

A higher percentage of the monthly mortgage payment is applied to the principal balance under a 15-year mortgage, which Lichtenstein said allows the loan to amortize at a much faster rate.

“The 30-year loan is a great product as well as it allows homeownership to be accessible to everyone,” he said.

For those who cannot afford the higher monthly payments of a 15-year mortgage, Shekhtman recommends choosing a 30-year mortgage and treating it like a 15-year mortgage.

“Set up automatic extra principal payments each month, even a few hundred dollars, and you’ll build equity faster without being contractually locked into the higher monthly obligation,” he added.

The views and opinions expressed are those of the interviewees. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. NTD does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. NTD holds no liability for the accuracy or timeliness of the information provided.