Many people who are looking to buy a home consider whether they need 30 year or 15 year fixed mortgage rates for their monthly payments. Buying a home later in life means that many people want to have the mortgage paid off early. There are always things to take into account before signing documents.

One important point is to ensure that the interest rate doesn’t change during the life of the loan. This means that they actually are too good to be true. A fixed rate mortgage maintains a set interest rate during the life of the loan. The greatest benefit with this type of agreement is that there are no sudden surprises. My husband and I looked into the loans available with 15 year fixed mortgage rates when we were looking at home for sale.

We wanted to pay off the house as soon as possible but we didn’t want to get in over our heads with high monthly payments. This meant that we had to consider 30 year fixed mortgage plans as well as 15 year mortgages.

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The problem was that we weren’t very happy about having a mortgage close to when we both retired and hoped that a 15 year fixed mortgage rate would still be available to us. We felt that there was a great deal of pressure to pay the mortgage off early. Taking everything into account we finally went for the easier 30 year mortgage plan instead.

There were many things that lead us to this decision, but the main one was that I found out I was having a baby. My regular monthly income would become unreliable because I wanted to be at home raising our child. The downside to the 15 year fixed mortgage rate was the higher monthly repayment. We could see the financial problem of getting in too deep. Despite the trepidation of having a longer term loan, it did reduce the repayments considerably.

We also make extra payments throughout the year to make the principal shrink quicker. Those few extra payments also help reduce the number of years you have to pay the loan over. This takes some discipline but it is well worth it in the long run. It was hard going against our preference for a shorter term fixed rate mortgage but we had to think about more immediate needs and abilities.

As it is things worked out very well.

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