Your Guide to Choosing a Mortgage Term

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Homebuyers choose the number of years they’d like their mortgage to last. The 30-year fixed-rate mortgage is by far the most popular.

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The term that will work best for each borrower largely depends on the monthly mortgage payment they can handle and how long they plan to keep the property.

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What Is a Mortgage Term?

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Simply put... The mortgage term is the number of years it will take to pay off a home loan if the minimum payment is made each month.

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Fixed-Rate Mortgages vs. Adjustable-Rate Mortgages

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A fixed-rate mortgage is exactly what it sounds like. You lock in an interest rate for the entire term. If market rates rise, yours will not.

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An adjustable-rate mortgage is much more complicated. An ARM usually will have a lower initial rate than a comparable fixed-rate mortgage. BUT...

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But a rate adjustment can bring a spike in mortgage payments that could be hard or impossible to bear.

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THAT'S NOT ALL! We have also compared the payments and interests between a 15-year and 30-year fixed-rate mortgage.

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SWIPE UP TO READ THE FULL ARTICLE

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