When considering their monthly repayments, many people considering buying a home look into 30 year or 15 year fixed mortgage rates. Paying the mortgage off early is important for many people that buy a home later in life. However, before you rush in and sign any papers there are points to consider.

It is always a good idea to confirm that the interest rate does not alter during the term of the mortgage. Avoid the mortgage loans offered by some lenders, the one that sound unbelievable because they usually are. Loans agreed with a 15 year fixed mortgage keep the same interest rate throughout the entire life of the loan agreement. If you are someone that wants a loan with a regular fixed repayment and no surprises then this is the main benefit with this type of agreement. Both my husband and I decided to research fixed rate mortgages when we started looking at homes for sale.

Having a realistic, sustainable monthly payment on our mortgage was important even though we wanted to pay off our debt as soon as possible. Considering longer term mortgages was one option if we could not afford a 15 year plan.

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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. There was obviously very good reasons to finish paying the loan off early. It took some time but we finally decided to go ahead with the 30 year mortgage plan.

After finding out I was having a baby, reaching the decision we did was the only one that made sense. I was going to raise our child from home so my contribution to the monthly income would be unreliable. The financial commitment per month on the 15 year fixed mortgage rate was just too high. We simply didn’t want to get in over our heads. After looking at the much lower amount we would be paying per month with a 30 year mortgage loan, there wasn’t any option but to go with it.

Being able to make additional lump sum payments during the year means the outstanding loan reduces faster. It is possible to take years off your loan if you can make a few extra payments during each year. In the long term, this is a strategy well worth pursuing. We would have much preferred to have taken out a loan with a 15 year fixed mortgage rate but we had to consider our other commitments as well.

All things considered, it all worked out for the best.

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