Fixed-rate mortgages with 15-year repayment term might be a good option for borrowers who want to pay off their house quickly and have the budget to make larger monthly payments. With this calculator, you can estimate what your payments would look like with a 15-year term and decide if it’s the right fit for your needs.
How to Use the 15-year Mortgage Calculator
Our 15-year mortgage calculator lets you see how different variables can impact your overall loan cost. To begin, you’ll need to provide the home price, your planned down payment, loan interest rate and loan repayment term.
If you click on the “additional options” button, you can input even more detailed information to better understand what you can expect to pay. For example, you could include property insurance costs, mortgage insurance premiums (MIP) or homeowners association (HOA) fees. While these expenses aren’t part of your mortgage payment, it’s a good idea to include them as part of your monthly housing budget.
After you’ve entered your information, click “calculate” to see a breakdown of your monthly payments along with an amortization schedule that divides your monthly payments by principal and interest over time.
15-year Mortgage Basics
While the monthly payments are higher with a 15-year mortgage than what you’d pay with a 30-year loan, you end up paying less in interest over the life of the loan due to its shorter time span.
15-mortgage: Typical Costs
The average interest rate for a 15-year mortgage is currently 6.55% compared to the 30-year mortgage rate of 7.12%.
This type of 15-year mortgage has a fixed interest rate, which means your rate and payment will stay the same throughout the life of the loan.
In addition to interest, remember to consider the closing costs you’ll pay with a mortgage. Closing costs usually range from 2% to 5% of your loan amount. Some typical fees you can expect include:
- Application fee: Up to $500
- Appraisal fee: $300 to $600 (depending on size of the home)
- Origination fee: 1% to 2% of the loan amount
- Underwriting fees: Up to $795
- Credit report fee: $15 to $30
You’ll also end up paying more if you opt to buy mortgage discount points, which can lower your interest rate. In general, one discount point is equal to 1% of your loan amount.
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15-year Mortgage Requirements
While eligibility criteria for a 15-year mortgage can vary by lender, there are a few common requirements that you’ll typically have to meet, including:
- Good credit: For a conventional loan, most lenders require a minimum credit score of 620. You might be able to get approved with a lower score if you opt for a loan backed by the Federal Housing Administration (FHA), U.S. Department of Agriculture (USDA) or Department of Veterans Affairs (VA).
- Verifiable income: Lenders want to see that you can afford to repay the loan.
- Low debt-to-income (DTI) ratio: Your DTI ratio is the amount you owe on monthly debt payments compared to your income. You should generally aim to keep your DTI ratio below 43% to qualify for a mortgage, though some lenders will accept ratios as high as 50% in certain cases.
You’ll also need to be prepared to provide a range of documentation, which can include:
- Income documentation: Tax returns, pay stubs and W2s (or 1099 forms if self-employed)
- Asset documentation: Bank statements, investment account statements and down payment gift letters (if applicable)
- Debt statements: Liability information for debts such as credit cards, student loans or auto loans
Related: Mortgage Application: What Does It Contain?
Comparing 15-year Mortgages to Other Loan Terms
If you’re considering a 15-year mortgage, you might also look into a 30-year loan. With a longer repayment term, you’ll likely have lower monthly payments. However, 30-year loans usually come with higher interest rates compared to loans with shorter terms, meaning you’ll pay more in interest over the life of your loan.
Another option to think about is a 10-year mortgage. Opting for a shorter loan can help you pay off your loan faster with less interest—but you’ll also have a higher monthly payment that could be harder to manage.
How to Find the Best 15-year Mortgage
Mortgage rates tend to fluctuate daily, so it’s a good idea to keep an eye on rates to find a good deal. You can start with the bank or credit union that you currently have accounts with.
Also, be sure to shop around and compare your options from as many mortgage lenders as possible. This way, you’ll have an easier time getting a loan that suits your needs. In addition to rates, be sure to consider other loan factors such as lender fees and eligibility requirements.
Frequently Asked Questions (FAQs)
What is the current 15-year mortgage rate?
Currently, the 15-year mortgage has an average interest rate of 6.55% compared to a week before when it was 6.62%.
Can you pay off a 30-year mortgage in 15 years?
Yes, it’s possible to pay off a 30-year mortgage in half that time, but it requires steady income and discipline.
The easiest method is to simply add a little extra to your mortgage payment every month. Make sure to check with your lender to ensure that the extra money is put toward the loan principal, not interest.
Another strategy is to make one additional payment every year—for example, if you consistently receive an annual bonus, you can plan to put that toward your mortgage.
You could also consider making biweekly payments on your mortgage instead of paying monthly. With this strategy, you’ll pay half of your required payment every two weeks, which equates to making 13 total payments in a year rather than 12. This might help you pay off your mortgage early by six to eight years. Keep in mind that not all lenders allow biweekly payments, so be sure to check if you can.
