Fixed Mortgage Rate

Considering whether you need a 30 or 15 year fixed mortgage rate is important for people looking to buy a home and concerned about their monthly payments. With the number of people buying a home when they are older, on the increase, clearing the mortgage debt early is important. However, before you rush in and sign any papers, there are points to contemplate. Over the period of the loan, it’s important to remember to make sure the interest rate remains the same.

It is always wise to avoid agreements that do not appear to have any negative aspects because they invariably have but are hidden. For loans that have 15 year fixed mortgage rates, the same amount of interest is maintained throughout the life of the loan. This is of great benefit for anyone that does not like surprises. My wife and I had already decided to research long term fixed mortgage rates when we started looking at homes for sale.

Although paying off the mortgage was our main priority, we did not want to have monthly payments that were uncomfortably high. It became obvious that we had to look at fixed rate mortgages over a longer period and not just 15 year plans. The 15 year fixed mortgage rate was the plan we really wanted because neither of us wanted to be still paying a mortgage when we close to retiring. There was a lot of pressure to have the house paid off as soon as possible.

After careful consideration we decided to take the longer term 30 year repayment option instead of the 15 year plan. There are always a number of points to think about when a decision like this has to be made. The most important point was the fact I discovered my wife was having a baby. As she intended to raise our child at home we couldn’t rely on her financial income to the monthly expenditure. The problem we could see was the increased financial commitment on a monthly basis if we had opted for the 15 year fixed mortgage rate. We could see the financial problem of getting in too deep even though there were benefits to a shorter loan period. We found that the monthly repayments on a 30 year loan were more manageable.

Making a few additional lump sum payments during the year helps bring down the amount owed. To our surprise we also discovered that we could knock years off our loan by doing this. It may be easier said than done, but this approach does pay off eventually. Taking our needs and abilities into account was more important than our desire for a shorter term mortgage plan. Despite all our worries, things turned out well for us and we do not regret the decision.