Your Guide to Choosing a Mortgage Term

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.

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. 

What Is a Mortgage Term?

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. 

Fixed-Rate Mortgages vs. Adjustable-Rate Mortgages

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.

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

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

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