Current 15-year fixed-rate mortgage rates

A 15-year fixed mortgage is a type of home loan with a fixed interest rate and a repayment plan spanning 15 years. As a popular option for first-time homebuyers, 15-year fixed mortgages provide a stable option for home financing.

Supply and demand within the real estate market is constantly fluctuating, as is the monetary supply and cost of funds. This constant flux forces mortgage interest rates up and down along with the latest economic trends. This constant ebb and flow of the housing economy constantly opens new windows of opportunity for buyers to invest in a home.

When these interest rates dip low enough, many borrowers jump at the chance to lock down a mortgage with a fixed repayment structure.

Similar to a 30-year fixed rate mortgage, 15-year fixed mortgages feature an unchanging rate throughout their lifetime. This fixed rate structure provides borrowers with the added security of knowing exactly how much their loan payments will be each month.

The payment’s certainty and regularity extends for the full course of the loan, eliminating the possibility of unexpected spikes in a repayment plan. As a result, these borrowers are free to pursue their long-term financial goals with confidence that their mortgage payments will not be altered.

When interest rates drop, savvy buyers who recognize the benefits of fixed rate loans might seize the timing and apply for a 15-year fixed rate mortgage.

These buyers know that by locking down a fixed mortgage when interest rates are low, they’ll be paying less in interest throughout the course of repayment. Even if the economy falters and rates skyrocket again, a 15-year mortgage structure protects your minimum payment and will not change throughout the life of the loan.

A longer term plan, such as a 30-year fixed mortgage, can offer the same certainty, but will end up costing the borrower more in interest, as the repayment plan is twice as long. Although the scheduled monthly payments are higher for 15-year mortgages, you’ll end up paying less in interest when the loan is fully paid off.

The higher monthly payments associated with 15-year loans might lead some borrowers to question whether they can afford a mortgage loan. Let’s take a closer look at 15-year fixed rate mortgages and how they can help borrowers achieve their homeownership goals.

15-year fixed mortgage rates offered by a lender are influenced by a number of factors. In addition to your own personal financial situation, the state of the economy and local housing market will have a heavy impact on how much you end up paying.

Since these variables can change over time, good 15-year fixed mortgage rates depend on when you decide to buy a home. For a better understanding of how the cost of financing can evolve over time and to put current 15-year mortgage rates in a historical context, let's take a look at how these numbers have changed over the past few years.

The best time to apply for a 15-year mortgage is when preparation meets opportunity. Since approval for these loans is based heavily on your personal financial situation, a better rate can come about when borrowers take the necessary steps to build their savings and make themselves the best financing candidate possible. A sizable down payment and a decent credit score can go a long way towards bringing down the cost of borrowing money.

When the appropriate financial preparation is complete, keeping an eye on how interest rates develop over time and where they’re expected to go can provide the insight borrowers need to time their mortgage application for the best possible deal.

Another method to finding a great 15-year rate is to meet with multiple lenders and gain a comprehensive understanding of your borrowing capabilities and which mortgage option offers the best fit.

Depending on the borrower’s personal financial situation and long-term investment goals, a 15-year fixed mortgage could provide the homebuying advantages they’re looking for. Here’s a look at the main benefits associated with a 15-year mortgage.

Shorter loan repayment

The shorter repayment schedule for a 15-year fixed mortgage is one of the biggest advantages to this loan structure. Monthly mortgage payments are often the heftiest bill for homeowners and can weigh down any progress towards building savings or making further investments.

While regular payments will be higher, borrowers who opt for a 15-year loan structure can be free of that financial obligation in a much shorter amount of time, opening a path for new savings plans in addition to homeownership.

Unlike a 30-year fixed rate mortgage, adjustable rate mortgages (ARMs) come with a fluctuating interest rate that rises or lowers along with market conditions.

Less interest overall

Compared to other popular loan options, such as a 30-year fixed mortgage, a 15-year structure means borrowers make fewer payments throughout the course of the loan’s term. By making fewer payments, these borrowers end up paying less in interest when repayment is concluded.

By paying a bit more each month, borrowers on a 15-year plan pay interest for a shorter amount of time, providing a quicker path to other homeownership benefits.

Build equity faster

By paying off interest in a shorter timeframe, 15-year mortgage borrowers can push towards building home equity much faster as well. Over time, the amount of interest paid each month will steadily decrease, while the amount that goes towards a loan’s principal rises.

While the minimum required payment will remain the same through the life of the mortgage, the portion of that payment that goes towards building ownership in the property increases. On a 15-year plan, borrowers who make timely payments will own more of their property sooner than they would with a longer term loan.

The shorter repayment schedule for a 15-year fixed mortgage is one of the biggest advantages to this loan structure. Monthly mortgage payments are often the heftiest bill for homeowners and can weigh down any progress towards building savings or making further investments.

While regular payments will be higher, borrowers who opt for a 15-year loan structure can be free of that financial obligation in a much shorter amount of time, opening a path for new savings plans in addition to homeownership.

Obviously, a 30-year mortgage is longer than a 15-year repayment plan, but that difference in length results in substantial differences for the borrower.

15-year mortgages typically come with a lower interest rate than their 30-year counterpart. While monthly payments might be substantially higher, interest will be paid off sooner as the amount that goes towards the buyer’s stake in the property grows.

However, opting for a 30-year fixed mortgage can greatly expand your homebuying options.By allowing you to pay off the loan for three decades, lenders tend to provide financing for more expensive properties than they do for 15-year plans.

On a 15-year mortgage, borrowers get a much lower lending limit, which could end up narrowing their buying options.