The ability to live debt-free is a frequently shared goal of many people. Paying off credit cards may only take a few months and car payments end after a few years, but as a mortgage is the biggest debt most people carry, the idea of paying a mortgage in full can seem like a daunting task.
Refinancing your fixed mortgage rate may be a viable solution to owning your home free and clear faster than you originally planned. With 30-year fixed mortgage rates today, you are making 360 payments with a large portion of the monthly amount being applied to interest rather than principal, specifically near the beginning of your payment schedule. Even with a relatively low-interest rate, this method adds considerable expense to the overall cost of buying your home. Refinancing to a shorter-term fixed mortgage rate loan not only reduces that overall cost but also gets you to the finish line of paying a mortgage faster.
15 year fixed mortgage rates are a popular option for homeowners. The monthly payments are generally higher, but the shorter length makes the loan more cost-effective in the long run and generally offers a lower interest rate. Over the full life of a loan, a 30-year mortgage can end up costing more than double a 15-year option.
Our team can help decide if a shorter-term mortgage is right for you!