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15-year mortgage of december 2022 in the United States

Apply for 15-year mortgage loans from companies verified by our specialists. On 03.12.2022 you have access to 0 home loans with a low rate. Increase your chances of getting money — fill out a multi-application with a free credit rating check.

15-year mortgage calculator in the United States

The best 15 year mortgage calculator
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USD
50000 $
500000 $
Mortgage amount
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USD
50000 $
500000 $
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30
Your 15 year mortgage amount
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Mortgage online application in the United States

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Types of mortgage loans

Arrowhead Advance
3.2
Olivia H
Olivia H
01.12.2022 at 06:07
My experience with getting a personal loan from this company was quite pleasant. The service was fast, no one asked about any collateral or my creditworthiness. Such things are always annoying...
Review
Spotloan
4.4
Noah J
Noah J
30.11.2022 at 20:45
Before taking out a loan, I compared Spotloan with other lenders and found out that their rates are the most acceptable. The mobile application works flawlessly. I quickly received approval...
Review
Spotloan
4.4
Isabella H
Isabella H
30.11.2022 at 20:40
At first, I liked everything in this company. I needed a payday loan and they offered a good alternative. Almost no documents are needed, it's true...
Review
Spotloan
3.8
Camila J
Camila J
30.11.2022 at 20:40
Spotloan is like a good old friend to me. I always try to make payments on time, so I usually have no problems with creditors. This company has simplified all possible procedures for obtaining a loan...
Review
Spotloan
3.6
Emma S
Emma S
30.11.2022 at 20:40
A very convenient application of the company. You can borrow small amounts starting from $3,000. In addition, the company operates in most states...
Review
Spotloan
4.6
Mateo J
Mateo J
30.11.2022 at 20:35
If you've never seen a company that can give you a maximum of $800, then this is just about it. But they respond to the application very quickly, they also quickly approve and transfer money to you...
Review
15-year mortgage of december 2022

What is a 15-year mortgage?

A 15-year mortgage is fixed-rate home loan amortized over 15 years. This type of loan has a fixed monthly payment, while the amount that goes toward the principal increases over time.

A 15-year mortgage can be a good alternative to a 30-year fixed mortgage as it has much lower total interest closing costs, such as loan origination fees, as customers pay interest for half the time. Another contributing factor to this loan is that the annual percentage rate (APR) for a shorter loan term is usually lower, which allows customers to save money. However, as customers pay off their loans in half the time, monthly payments are much higher.

The significant competitive advantage of these types of mortgages is fixed rates and payments that remain the same during the loan life. Hence, when customers borrow a loan, they know exactly when they will become debt free and what their total costs will be.

Pros and cons of a 15-year mortgage

Pros

  • A 15-year fixed mortgage costs less in the long run, since the total interest rate payments are less than on a 30-year mortgage. The cost of a 15-year mortgage rates is based on annual interest mortgage rates, and since customers borrow the money for half as long, the total interest makes up half of what they pay over 30 years.

  • Short-term loans present less risk and are much cheaper than long-term loans. So, a 15-year mortgage typically comes with lower interest mortgage rates. The rate can be between a quarter-point to a whole point less than the 30-year mortgage.

  • If putting less than 20% down, customers can get less mortgage insurance than a 30-year mortgage.

  • The ability to pay off the mortgage lender back completely in a relatively short period. That may be an appropriate option for people that don't like owing anyone money.

  • Customers can build up equity faster than with a longer loan term and save lots of money on interest, as the loan's lifetime is shorter.

  • High monthly mortgage payments can prevent customers from investing or diversifying investments more.

  • With a 15-year loan, customers can get a mortgage interest deduction, which will be one-fifteenth of the loan and thus significantly reduce taxable income by the amount of money paid in low mortgage interest during the year. Furthermore, if refinance with a different lender within the lifetime of the mortgage, a clientele can deduct all the remaining mortgage points costs in that year, which is quite a convenient option.

Cons

  • A higher monthly payment may not give an opportunity to build up savings or invest the difference between the 15-year and 30-year payments in higher-yielding securities.

  • Monthly principal and interest estimated payments for a 15-year fixed-rate mortgage run about 50% higher than on a 30-year home loan. Customers have to pay property taxes and, if putting less than 20% down, homeowners insurance as well. This could make it hard to respond to emergencies and lead to selling, refinancing, or foreclosure.

  • Customers must sell or get a home equity loan to get money out of their house investment.

  • With the rising cost of inflation, the income and other expenses will probably rise, but the mortgage payment won't. So, it may be much cheaper to get a 30-year fixed loan.

Conclusion

It is a good choice for borrowers who want to become debt free as soon as possible or would like to pay off the loan quickly and own the home outright, but cannot qualify for another type of mortgage or want to have lower payments. Home buyers who want to have low total interest costs may also prefer a 15-year fixed-rate mortgage. Moreover, this shorter loan can provide significant savings compared to a 30-year fixed-rate loan.

Nevertheless, borrowers usually need to have a relatively high income and low debt to qualify for a 15-year fixed-rate mortgage. Given the higher monthly payments, the nation's largest mortgage lenders require a lower debt-to-income ratio. For some customers, this can make the qualifying process somewhat challenging. There are alternatives the borrowers may consider, such as FHA loans, VA loans, or USDA loans, as they are backed by the government institutions like the Federal Housing Administration.

What affects a 15-year mortgage rates

Mortgage lenders set 15-year interest rates based on a credit score, income, debt, and savings. So, the better the customer's credit and financials, the better the rate they will be offered.

While customers can control these qualifying factors, some other outside forces influence the successful application process. These are economic conditions, inflation, and the lender's overhead. Overall, rates change frequently, so when customers get a loan with an appropriate mortgage rate, they have to consider a rate lock so as not to bother themselves with it changing before closing on the loan.

How to get a good 15-year mortgage rate?

Check your credit score and report

An excellent credit score is a key determining factor in loan eligibility in the housing market and the lower interest rate. So, to get the lowest loan rate, customers have to get a high score. To do that, they can check their credit historand score with a mortgage rate table from various mortgage companies to get a better purchase price.

If you notice mistakes in the report, correct them before applying for a loan, and if there's a late payment, write a goodwill letter and ask the lender to remove it. If your credit score is low because of the high credit utilization ratio, pay off a debt to raise it.

Make sure your finances are in order

Note that lenders make a credit report when determining loan eligibility and interest rate. They also pay attention to a customer having a stable job, plenty of income to repay the loan, and the customer's assets in the bank. Make sure to meet all these eligibility requirements before loan approval.

Save up a large down payment

A larger down payment makes customers less risky borrowers, as they have more equity in the home. It also means they borrow less loan amount, which helps reduce the cost of the mortgage. To get the best interest rate, customers must have a saving of at least a 20% down payment. Hence, if customers can save a little more, lenders will be eager to give them a loan at a great rate.

Decide if paying points makes sense

To get lower rates, customers may also buy a mortgage point. Buying points allow you to get prepaid interest. One mortgage point costs 1% of the loan's value and reduces the customer's rate by 0.25%.

Usually, customers recoup the cost of buying points in a few years. They will need to figure out how much the interest savings reduce the monthly payment to see how long it takes to recoup the cost. As it lowers the interest rate, it can be a good idea if the clientele wants to pay the least interest during the repayment period.

Shop around for mortgage lenders

Finally, it is paramount to compare different lenders, mortgage rates, and terms from at least three banks, credit unions, online lenders, and other financial institutions, as they may all differ in interest costs, fees, and other loan terms.

Moreover, most lenders will allow getting pre-approved and finding out the loan rates without a hard credit inquiry, so it will not affect the customer's credit score.

After comparing options from various lenders, customers may also check loan terms from mortgage lenders and consider not only the interest rate but also whether the loan is a fixed or variable rate, whether they are required to pay points, what the lender's origination fees and other costs are and how long the repayment period is.

Also, make sure that there are no prepayment penalties to pay off the loan earlier. After finding a lender offering the best deal, customers can complete the application process and get an affordable 15-year loan that enables them to get out of debt on the home ASAP.

FAQ

What is the average 15-year mortgage interest rate?

Currently, the national average 15-year fixed mortgage actual rate (APR) is 6.200%, compared to last week's 5.840%.

Are rates higher for a 15-year mortgage rate?

Average interest mortgage rates are lower for a 15-year fixed-rate mortgage than for home loans with longer loan terms. Hence, customers will be able to save some money with a 15-year mortgage because of paying the interest for fewer years and building equity much faster.

What is the lowest 15-year mortgage rate?

Since 1991, the lowest average 15-year annual mortgage rate on 15 years fixed mortgages was 2.66%.