15-Year vs 30-Year Mortgage: Which Should You Choose?

Choosing your mortgage term is one of the biggest financial decisions in a home purchase, and it usually comes down to two options: 15 years or 30. They produce very different monthly payments and very different lifetime costs, and the cheapest one on paper is not always the smartest one for you.

The core trade-off

A 15-year mortgage has higher monthly payments because you are repaying the same balance in half the time. In return, you pay it off twice as fast, usually get a lower interest rate, and pay dramatically less total interest. A 30-year mortgage has much lower monthly payments, which makes a home more affordable month to month, but you pay far more interest over the life of the loan.

Why the interest difference is so large

Two things stack up in favour of the 15-year loan: you borrow the money for half as long, and lenders typically offer a lower rate on shorter terms. Combined, these can cut the total interest you pay by more than half. On a typical loan that difference often runs into six figures.

The case for the 30-year

A lower required payment is not just about affording a bigger house — it is about flexibility and safety. With a 30-year loan you keep more cash each month for emergencies, investing, or other goals, and you are far less likely to be stretched if your income dips. Many borrowers take a 30-year loan and simply pay extra when they can, getting much of the payoff speed without locking themselves into the higher required payment.

• Choose 15-year if you can comfortably afford the higher payment and want to be debt-free fast with minimal interest
• Choose 30-year if you value lower required payments, flexibility, or want to invest the difference
• A middle path: take the 30-year and make extra principal payments voluntarily

The "invest the difference" question

A common argument for the 30-year loan is that you can invest the monthly savings and potentially earn more than your mortgage rate. That can work — but only if you actually invest the difference consistently rather than spending it. The 15-year loan forces the saving for you, which for many people is its real advantage.

A shortcut to the 15-year result

If you like the safety of the 30-year payment but want the payoff speed of the 15-year, biweekly payments or a fixed extra amount each month get you most of the way there — without committing to the higher required payment. See exactly how much time and interest extra payments save.

There is no universally correct term — only the one that matches your income stability, your other goals, and your tolerance for a higher fixed payment. Run both through a calculator with your real numbers before you decide.