Today’s Lowest 15-Year Mortgage Rates Chart and Table

Let a Pennymac loan expert uncover the best mortgage rate and savings tailored to you, so you can achieve your aspirations of home. Compare the interest rate of the current mortgage and that of the 15-year fixed mortgage. Your interest rate remains constant throughout the loan term, protecting you from potential rate increases and making budgeting easier. With a 15-year mortgage, you build home equity faster than with a 30-year mortgage. This allows you to utilize the equity for home improvements or other financial needs sooner.

Is A 15-Year Mortgage Right For You?

Getting preapproved with a few different lenders can help you find the best 15-year mortgage rates available. You should be able to get a low 15-year fixed mortgage rate with a sizable down payment, excellent credit score, and low DTI ratio. If you’re not expecting a windfall and you’re not sure how much your income might grow over the years, opting for a 30-year loan makes sense. Even if you’re confident now that a 15-year mortgage is a good option for you, circumstances can change. Job loss, illness, house fire, family emergency – even the most well-maintained budget can take a hit from the unexpected things life throws at us.

Why compare 15-year refinance rates today

But this compensation does not influence the information we publish, or the reviews that you see on this site. We do not include the universe of companies or financial offers that may be available to you. I strongly recommend a 15-year fixed mortgage if the payment is affordable, as the significant amount of equity gained per payment is very substantial. Even with higher rates, the mortgage is much shorter, with much less interest, and it’s a great way to tackle equity with every payment made. Our advertisers do not compensate us for favorable reviews or recommendations.

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The better choice is the one that works best with your finances and long-term goals. These fees typically apply to borrowers with lower credit scores, smaller down payments, or both. The Federal Housing Administration also charges higher mortgage insurance premiums to 30-year borrowers. A mortgage is simply a particular type of term loan—one secured by real property. For a term loan, the borrower pays interest calculated on an annual basis against the outstanding balance of the loan. But many of those buyers might have been better served if they had opted for a 15-year fixed-rate mortgage instead.

• As you weigh your mortgage options, it’s important to understand how getting a 15-year home loan will affect your monthly payments and how much you end up paying for your home over the long run.
• The smaller monthly payments with a 30-year mortgage may give you extra money to sock away in a college account that can grow and earn interest over the years.
• I have owned for 3.5 years and so far on track to pay it off in under 15 years.
• You’ll pay off a 30-year mortgage in 30 years, while you’ll pay off a 15-year in 15 years.
• That said, well-qualified borrowers are still getting much lower rates than average.
• Rates, terms, programs and underwriting policies subject to change without notice.
• Of course, mortgage interest rates also move up and down on a broader scale with the overall interest rate market.
• Interest rate and program terms are subject to change without notice.
• This table does not include all companies or all available products.

Current 15-year mortgage rates compared to other loan types

Not many people are disciplined to pay down extra principal when they have extra cash. You can take out a 20- or 30-year loan and make additional principal payments at your convenience to get the advantages of a shorter-term without locking yourself into the higher payments. The key is that you are free to make extra payments when you want to, rather than being locked in as you would with a 15-year loan.

How do 15-year mortgage rates compare to 30-year rates?

If your budget is tight, you might have to lower your price range to find a home you can afford with a 15-year loan. The lowest average 15-year mortgage rate ever recorded was in mid-2021, when it fell to 2.10%, according to Freddie Mac. Debt.org wants to help those in debt understand their finances and equip themselves with the tools to manage debt.

Fixed Rate Mortgages

Paying off your mortgage by the time you retire is like a satisfying accomplishment and gift to yourself. In this scenario, getting a 15 year implies maxing out retirement accounts automatically. Would maxing out both you and your spouse’s 401k and Roth IRA and HSA (assuming your both healthy) be a better investment than saving many thousands of dollars in mortgage interest? This is actually a simple math problem and many financial advisors have come to a consensus. I’d only add that Dave Ramsey sees this as a behavior problem, and therefore he strongly prefers a 15 year mortgage.

Government loans

For many people, the lower payments of a 30-year mortgage are more affordable and offer an extra level of security in case times get tough. You can always make extra payments each month, effectively turning your 30-year term into a 15-year one. If you have a 30-year mortgage and are more than halfway through your loan term, refinancing into a 15-year loan with a lower rate could save you thousands in interest. Bankrate’s 15-year vs. 30-year calculator can help you make the decision. Keep in mind that rates have shifted dramatically over the past few years. If that same family chooses a 30-year mortgage at 5.34%, their monthly payments would be $669.

Future Income

The higher the interest rate, the greater the gap between the two mortgages. When the interest rate is 4%, for example, the borrower actually pays almost 2.2 times more interest to borrow the same amount of principal over 30 years compared with a 15-year loan. If you’re uncertain about how hefty a mortgage payment you can afford in the first place, try a home affordability calculator. On Monday, January 06, 2025, the national average 15-year fixed refinance APR is 6.41%.

Calculate a mortgage payment

And now, it’s really small, so I plan to pay it off within 12 months. If leverage is so great how come we aren’t all buying stock on margin? I think whatever mortgage term gets you to pay off your loan the fastest is the best one to choose. I consider myself somewhat informed when it comes to investments but I have a hard time with the leverage concept. Even when you’re leveraging your money on real estate your still paying interest. I understand the math on leverage, but not paying interest is still better than paying interest IMO.

Year Fixed Mortgages

That’s roughly $254 less each month ($3,048 a year) with a longer term. For some families, it makes sense to save the extra money or have it as cash on hand for groceries, emergencies or college savings. On the other hand, some families would rather pay off the mortgage as quickly as possible, and have room in their budgets to do so. In general, you’ll find that fixed mortgage rates are higher than adjustable rate mortgage (ARM) rates. Anyone who wants a variable rate mortgage will have a lower mortgage rate at the beginning of their loan term.

See how 15-year fixed mortgage rates compare

• I’m surprised you got a 10/1 ARM for a condotel mortgage in the first place!
• On Monday, January 06, 2025, the national average 15-year fixed mortgage APR is 6.38%.
• If your plan is to absolutely spend the least amount of money overall, a 15-year fixed-rate mortgage is the way to go.
• In the past, I’ve written the best time to buy property is when you can afford it.
• If they extend a fixed rate for a full 30 years, they need to bake in some profit and offer a slightly higher rate.
• Average 15-year mortgage rates have generally been in the upper 5% range in recent weeks, according to Zillow data.
• The payment of 1% by Pennymac will be accomplished through a custodial escrow account, to be funded by the lender-paid credit.

At some point, you may have so much money that the debt becomes an annoyance and trying to always maximize returns is no longer necessary. Maybe that net worth level is $3 million for some or $20 million for others. Let’s say you bought your second primary residence, a forever home, at age 32.

What Is a 30-Year Fixed-Rate Mortgage?

Instead of paying off the mortgage in 2013 as planned, I paid it off in 2017. In addition, if you take out a 15-year mortgage, a greater percentage of your payment will go towards paying down principal. With a $1 million, 30-year mortgage at 3%, $1,716 of the $4,216 monthly payment (40.7%) goes to paying down principal.

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Consider these factors when deciding if a 15-year mortgage is the right call. Consumers pay less on a 15-year mortgage—anywhere from a quarter of a percent to a full percent (or point) less, and over the decades that can really add up. So if you’re looking for the best home loan experience, you’ve come to the right place.

It’s important to keep in mind that your tax savings will likely be low if you’ve got a 15-year fixed-rate mortgage. Since you’ll be paying less interest than someone with a 30-year fixed mortgage loan, you’ll have less interest to deduct. But in the long run you are saving money by paying less interest. While it’s possible to qualify for a mortgage with a low credit score (even if it’s below 620), it’ll be more challenging and could result in a high interest rate. If this is your situation, your best bet might be to go for an FHA loan or a USDA loan. The former is designed for first-time homebuyers, while the latter is built for those buying a home in a rural area.

One way to look at a 15 year fixed loan is “short term pain for long term gain”. Meaning, you face higher monthly mortgage payments than other longer-term options, but as a result, you will pay down your note much faster. With a fixed rate mortgage, your monthly mortgage payments remain the same throughout the term, which makes budgeting easier as you know exactly how much you will be paying each month. A 15-year mortgage fixed rate may be beneficial for many homeowners compared to other traditional loans, especially a conventional 30-year mortgage.

Mortgage Calculators

Before you decide to take on a 15 year fixed term mortgage, it is important to assess whether you are able to sustain the higher monthly cost. If you consider yourself someone with a reliable income and self-discipline to commit to a higher monthly payment, then you could be mortgage-free in just fifteen years. LoanDepot can provide you with pricing and amortization schedules for all of our loan terms, so you can make an informed decision.

• That might be a good deal for first-time buyers who previously spent about the same amount on rent.
• The interest rate on a 15-year is so low it’s practically free, or potentially negative in inflation-adjusted terms.
• Interest rates and program terms are subject to change without notice.

Buying a home is a huge decision, and picking the right mortgage is a huge part of that process! Here’s why the 15-year fixed-rate mortgage might be one of your best options when it comes to buying a house. As mentioned above, having a large part of your savings locked up in one asset alone could hinder your ability to contribute to other areas such your 401k, child’s college tuition, or stocks. If your monthly payment interest rate for 15 year mortgage consumes a large chunk of your take home pay, you may not be able to leverage additional investment opportunities. Although you will accumulate equity at a faster rate with a 15 year mortgage, you may also be required to sell the property in order to access this pool of savings. Therefore, if a large chunk of your life savings is tied up in your home, it may be harder to access these funds during a time of emergency.

Other homebuyers, who are more established in their careers, have higher incomes and whose desire is to own their homes before they retire, may also prefer this mortgage. 2In eligible fixed-rate purchase loan transactions, Pennymac will pay 1% of the note rate for the first 12 payments of the loan. This offer effectively reduces the rate of the loan by 1% for the first year of the mortgage. The payment of 1% by Pennymac will be accomplished through a custodial escrow account, to be funded by the lender-paid credit. The offer excludes VA, Jumbo, Closed-End Second and Adjustable-Rate Mortgages, refinance, investment property, third-party and in-process loans.

If saving is too difficult with a 15-year mortgage, consider taking a 30-year mortgage and paying more than the required monthly payment when you can. Since monthly payments on a 15-year mortgage will be higher, you won’t have as much wiggle room and you might not be able to save as much. However, after 15 years you won’t have any mortgage payments, freeing up capital to invest and spend freely. With a longer term of 30-years, you spend a long time paying down mortgage interest before you make a meaningful dent in your loan principal. With a shorter-term loan, you’ll start to pay down the loan balance and build equity a lot faster.

If you plan to stay in your home for a long time, you might prefer a 15-year mortgage since you’ll pay off your mortgage sooner and benefit from owning your home free and clear. You’ll also build equity more quickly, which you can then access using a home equity loan, HELOC, or cash-out refinance. Some people want to pay off a mortgage before their children go to college. That’s fine, since it will take a large expense out of your budget at a time you’ll be taking on another big expense. But keep in mind that there are alternative ways to save for college, including tax-free 529 savings plans. The 15-year loan payment would be $2,108 exclusive of a required escrow payment for taxes and insurance.

Some borrowers opt for the 15-year vs. a 30-year mortgage (a more conventional choice) since it can save them a significant amount of money in the long term. When mortgage rates decline, more homeowners look to refinance, sometimes to 15-year loans. A 15-year mortgage can set you on the path to build equity faster and pay off your loan sooner, potentially for less interest — but it comes with downsides, as well. Let’s break down whether refinancing to a 15-year mortgage is right for you. Some home buyers start with a 30-year mortgage and later refinance to a 15-year mortgage.

The extra money you’ll spend every month on a 15-year mortgage is money that can’t be spent elsewhere. Getting a 30-year mortgage with a lower monthly payment could enable you to up your retirement savings or put away cash for a new car or a vacation. Be sure to consider the full financial picture before committing to a shorter-term loan. “Currently there are no fixed-income investments that would yield a high enough return to make this work,” says Shah. Rising mortgage rates can make this method even more difficult. The risk might not always pay off if it coincides with the kind of sharp stock market drops that occurred during the downturn of 2020.

A 15-year fixed-rate mortgage is a home loan that is structured to provide an unchanging interest rate for a shortened period compared to the traditional 30-year fixed-rate option. Investment products and services are offered through Wells Fargo Advisors. We consider a variety of factors when we determine the interest rate and costs of your loan. The process of reviewing these factors to determine your rate is called “risk-based pricing.” Choosing when to lock your interest rate is an important part of the home financing process. During the pandemic, mortgage rates hit historic lows, and 15-year mortgage rates neared 2%.

• But, over the lifetime of your loan, you’ll see serious savings on mortgage interest.
• With rising interest rates, many home buyers seek ways to lower their borrowing costs.
• If you do choose a 15-year mortgage, you should be confident in your job’s stability.
• With a high inflation environment, better to borrow money and save up for additional rental property investment opportunities.
• Not all loan programs are available in all states for all loan amounts.
• Here’s why the 15-year fixed-rate mortgage might be one of your best options when it comes to buying a house.
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Become a full homeowner in just 15 years, half the time of a traditional 30-year mortgage, setting you up for a stronger financial future. Start the conversation with a salary-based mortgage consultant. Angela Colley writes about real estate and all things renting and moving for Realtor.com. Her work has appeared in outlets including TheStreet, MSN, and Yahoo. An amortization schedule outlines how long it takes to pay down your mortgage principal and interest.