What is the Difference Between a 30 Year Mortgage and a 15 Year Mortgage? Which is Better?

Getting a new house can be quite complicated most of the time, as there are several steps and processes that you would really need to follow before you proceed in actually owning a house. One of those processes is getting a home mortgage, which is a type of deal wherein a lender would give you money to get a new home in exchange for the agreement that the lender will have the right to take the property from you if you fail to repay the loaned money in time.

Although mortgages may seem terrifying for a lot of people to get, they are usually necessary if you really want to buy a new home, as purchasing a house using straight cash isn’t possible for most of us. When planning to apply for a home mortgage, there are two types of mortgages that you have to choose, and these types are the 30-year mortgage and the 15-year mortgage. What is the difference between the two? And which one is better? Let us find out as we take a look at the details of the 30-year and the 15-year mortgages.

The 30-Year Mortgage

The 30-year mortgage is arguably the most popular type compared to the 15-year mortgage, and the reason why it is popular is that it allows you to pay the mortgage of your home for 30 years. Because you have to pay the house in 30 years, the division of payment is much lower since the monthly payment of the mortgage is about a half lower compared to the 15-year mortgage.

Paying Off a 30-year Mortgage in 15 Years

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It is cheaper to pay off your 30-year mortgage in 15 years. This is because it will save you 15 years of extra interest payments. However, it will not save you a lot more than going for a 15-year mortgage in the first place. The only advantage of choosing to pay off your mortgage sooner is that you can decide when to make extra payments and when to save. 

Many people would advise against this because it is rare that you are able to make double payments every month. There are always other expenses to make, like backyard renovation or family vacations. And well that is also just as important as owning your own house. When you have a 15-year mortgage, the payments have to be made so then you will cut down on the other expenses to make sure you make the monthly payment. There is a lot more accountability and responsibility to pay off the mortgage. 

This aside, if you think paying a 30-year mortgage in 15 years is a better decision for you, here are some tips to help you accomplish your goal:

  • If your lender allows for it, make biweekly payments. This way you will make 26 half payments or 13 full payments. This means one extra payment each year. 
  • Another option is to make additional payments every month. This way you will not only be able to pay off your mortgage faster but also have to pay a lower interest amount. 
  • You can also make a goal to just make one additional payment each year. You can save a little every month and then pay two installments at the end of each year. This method will also result in a lower amount of interest to be paid. 
  • You can reduce your mortgage balance by recasting your mortgage. This will also reduce the monthly payments. 
  • Do not overspend on things like retail therapy and eating out. The more you save the sooner you can pay off the loan. 
  • If you change your mind after signing for a 30-year mortgage, you can refinance the loan into a shorter term. Get a new 15-year loan so that you can pay off the mortgage sooner. However, this will result in higher monthly payments. 

If none of these tips work for you and making monthly payments is becoming more difficult by each month, consider selling your house to pay off the mortgage. You can then move to a more affordable neighborhood or buy a smaller house. 

The Pros and Cons of the 30-Year Mortgage

There are pros and cons to applying for a 30-year mortgage, and some of these are already evident in what we mentioned earlier. But to know more, here are pieces of information that you should know about the advantages and disadvantages of the 30-year mortgage.


  • Lower monthly payment compared to the 15-year mortgage.
  • It wouldn’t be a hassle to pay monthly because it wouldn’t take much from your salary or income.
  • You can use most of your money for necessities.
  • Enables you to save more money instead of spending more.
  • Use the money you save for college funds, retirement funds, and other types of funds that you will benefit from in the future.


  • Has a higher interest rate.
  • You would have to pay the mortgage for much longer compared to the 15-year mortgage.
  • Home equity can be slow to build on a 30-year mortgage.
  • It can be a hassle to pay in the long run, especially if you lose a stable source of income.
  • Spend more on the interest of the mortgage instead of the life of the loan.

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The 15-Year Mortgage

The 15-year mortgage is the other type of mortgage that is not as popular as the 30-year mortgage but offers a set of different advantages or benefits. As its name already suggests, the 15-year mortgage allows you to pay for the mortgage for your home in 15 years, which is shorter than the 30-year mortgage and has a higher monthly payment division. When you are paying about $100 per month for a 30-year mortgage, you would have to pay double on a 15-year mortgage.

However, even though you would have to pay double on a 15-year mortgage compared to a 30-year mortgage, the interest rate of the former is much lower, so what you are paying for is actually close to the real price of the mortgage. If you are able to pay the mortgage for 15 years, it is highly recommended to choose the 15-year mortgage since it has a lower interest rate and it is cheaper to pay in the long run.

The Pros and Cons of the 15-Year Mortgage

Similar to the 30-year mortgage, the 15-year mortgage also has its pros and cons. However, depending on your preferences, the pros of the 15-year mortgage can outweigh their cons. To know more, here are details about the benefits and disadvantages of the 15-year mortgage.


  • Has a lower interest rate.
  • You can pay off your debt quicker.
  • Build your home equity faster.
  • You can already pay off the mortgage before your retirement.
  • Spend less money on interest and more on the actual loan.


  • The monthly payment of the mortgage may be too high for some people.
  • You would have to spend more from your salary or income since the monthly payment is higher.
  • Some first-time buyers may not have enough financial capabilities to qualify for the 15-year mortgage.

Which Type of Mortgage is Better?

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Now that we have discussed the different pros and cons of the two types of home mortgages, let us now talk about which one is actually better. The answer is that it depends on your preference and how much you are willing to pay per month or for years. Many would say that the 30-year mortgage is better since it has lower monthly payments and is considered more affordable despite having a higher interest rate. However, there are also people that would say that the 15-year mortgage is better since you can already pay off your debt in a shorter time, and it has a lower interest rate.

If you are able to pay for the home mortgage for a shorter period of time, we recommend that you get the 15-year mortgage, although you will often need to have a relatively high credit score in order for you to qualify for the said type of mortgage. But, if you want to pay for lower monthly fees and don’t have the capacity to pay higher, we suggest that you settle for the 30-year mortgage.