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The 15-year mortgage, though not as popular as the ubiquitous 30-year mortgage, is a solid money-saving option for borrowers who can afford a larger monthly payment.
Because the terms are shorter and 15-year mortgage rates are lower than 30-year rates, you could potentially save hundreds of thousands of dollars over the life of the loan by opting for a 15-year fixed-rate mortgage.
What are the current 15-year mortgage rates?
Check out the latest rates to see how today's 15-year mortgage rates and 15-year refinance rates compare.
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15-year mortgage vs. 30-year mortgage
How do 15-year mortgage rates compare to 30-year rates?
Because they're shorter terms, 15-year fixed mortgage rates are lower than 30-year rates. Here's how 30-year and 15-year mortgage rates have trended over the last five years, according to Freddie Mac data:
Is a 15-year mortgage better than a 30-year mortgage?
Lower interest rates
Average 15-year rates are lower than 30-year mortgage rates because you're signing up for a shorter term, which is less risky for the lender. That's the general rule: The shorter your fixed-rate term, the lower the rate. You'll also pay less in interest over the years with a shorter term, because you'll repay the mortgage sooner.
Build equity faster
Because you're paying off a 15-year mortgage faster, you'll also gain equity in the home sooner than you would with a 30-year loan. This can be beneficial if you end up needing to take cash out of the home at some point to fund a home improvement project, or if you want to sell and use your equity as a down payment for your next home.
Higher monthly payments
A 15-year fixed mortgage helps you save money on interest over the long term, which means it's a good deal if you're looking to keep your overall costs down. But these mortgages aren't for everyone, especially if you're looking to keep your monthly payment as low as possible.
Your monthly payments will be higher with a 15-year mortgage than with a 30-year mortgage or 30-year mortgage refinance. You're paying off the same amount in half the time, so you'll pay more each month.
15-year mortgage benefits
Total interest savings
To see how much you could save overall with a 15-year fixed-rate mortgage, take a look at this 15-year mortgage rate comparison for a $250,000 loan, using average interest rates for the week of October 24, according to Freddie Mac data:
| Type of mortgage | 15-year fixed-rate | 30-year fixed-rate |
| Interest rate | 5.71% | 6.54% |
| Monthly payment | $2,071 | $1,587 |
| Total interest paid | $122,721 | $321,231 |
By the end of your term with the 30-year loan, you'll have paid more than $300,000 in interest. A 15-year loan could save you almost $200,000 in comparison.
"If you can comfortably afford a 15-year mortgage, then they should consider it," says Melissa Cohn, regional vice president at William Raveis Mortgage. "Rates on a 15-year are considerably lower than a 30-year, and the overall savings on interest payments is significant!"
Pay off your mortgage sooner
If you plan to stay in your home for a long time, you might prefer a 15-year mortgage since you'll pay off your mortgage sooner and benefit from owning your home free and clear. You'll also build equity more quickly, which you can then access using a home equity loan, HELOC, or cash-out refinance.
15-year mortgage rate trends
Mortgage rates decreased over the last few months, but they've increased a lot this month. In September, average 15-year fixed mortgage rates fell to 5.01%, down 37 basis points from the previous month's average, according to Zillow data. But in October, they've spiked back up closer to 6%.
What were the lowest 15-year mortgage rates?
The lowest average 15-year mortgage rate ever recorded was in mid-2021, when it fell to 2.10%, according to Freddie Mac.
During the pandemic, mortgage rates hit historic lows, and 15-year mortgage rates neared 2%. But they've increased quite a bit since then, trending up rapidly throughout 2022 and 2023. Though they've been going back down recently, rates are still a bit elevated. It's unlikely they'll go as low as they were during the pandemic again.
15-year mortgage rate forecast
Mortgage rates are expected to go down in 2025. How much they fall depends on the economic outlook and how much the Federal Reserve ends up lowering the federal funds rate.
How to find the best 15-year mortgage rates
Lenders take your finances into consideration when determining an interest rate. The better your financial situation is, the lower your rate will be.
Lenders look at three main factors: down payment, credit score, and debt-to-income ratio.
- Down payment: Depending on which type of mortgage you take out, a lender might require anywhere from 0% to 20% for a down payment. But the more you have for a down payment, the lower your rate will likely be.
- Credit score: Many mortgages require at least a 620 credit score, and an FHA loan lets you get a mortgage with a 580 score. But if you can get your score above the minimum requirement, you'll probably land a better interest rate. To improve your score, try making payments on time, paying down debts, and letting your credit age.
- Debt-to-income ratio: Your DTI ratio is the amount you pay toward debts each month in relation to your monthly income. You generally can't get a mortgage with a DTI above 50%, and you can get a lower mortgage rate with a lower ratio. To decrease your DTI ratio, you either need to pay down debts or consider ways to increase your income.
You should be able to get a low 15-year fixed mortgage rate with a sizable down payment, excellent credit score, and low DTI ratio.
Use our free mortgage calculator to see how current 15-year mortgage rates will affect your monthly payments and long-term finances.
Mortgage Calculator
- Paying a 25% higher down payment would save you $8,916.08 on interest charges
- Lowering the interest rate by 1% would save you $51,562.03
- Paying an additional $500 each month would reduce the loan length by 146 months
You can apply for preapproval with a lender to get an idea of the rate you'll pay. Getting preapproved with a few different lenders can help you find the best 15-year mortgage rates available.
Finding the best 15-year refinance rates
Shopping for 15-year refinance rates is similar to the process of finding the best purchase rates. You'll want to have a strong credit score, a low DTI, and sufficient equity in your home. Don't default to working with your current mortgage lender; get offers from multiple lenders and compare rates and fees.
Is a 15-year mortgage right for you?
Consider your income
Can you afford a larger monthly mortgage payment? Most borrowers opt for a 30-year term since it gives them a long time to pay back the loan, lowering their monthly payments.
"Yes, your rate will be lower on a 15-year, however, the 30-year gives you more flexibility if you are ever tight on cash," says Paul Gabrail, host and founder of the YouTube channel Everything Money. "Remember, you can always pay down extra on a 30-year mortgage if you choose."
A longer-term also enables you to borrow more money. If your budget is tight, you might have to lower your price range to find a home you can afford with a 15-year loan.
Long-term plans
You might like a 15-year fixed mortgage if you plan to stay in your home for a long time and want to be aggressive about paying off your mortgage.
If you want to move in the next few years, you might prefer a different term. A 30-year fixed rate will come with lower monthly payments.
Financial goals
The extra money you'll spend every month on a 15-year mortgage is money that can't be spent elsewhere. Getting a 30-year mortgage with a lower monthly payment could enable you to up your retirement savings or put away cash for a new car or a vacation. Be sure to consider the full financial picture before committing to a shorter-term loan.
What are my other options? Comparison of mortgage terms and types
Picking a term length: 10-year, 15-year, 20-year, or 30-year
Though 30-year and 15-year mortgages are both very popular term lengths, they aren't your only options. Many lenders also offer 10-year and 20-year options. Some lenders even give borrowers the option to customize their term length to their needs.
When choosing a term length, think about how much you can afford to pay each month and how quickly you want to pay off your mortgage. If you have a larger monthly budget and want to be able to own your home outright, you might opt for a shorter term. But for many people, keeping their monthly payments as low as possible is the goal, which is why 30-year mortgages are so popular.
Understanding the differences between fixed and adjustable-rate mortgages
An adjustable-rate mortgage might be beneficial if you can get a lower rate and plan to sell or refinance before the rate adjusts.
With an ARM, you'll have a fixed rate for a certain number of years. After this, your rate will adjust periodically based on current market rates. So with a 5/1 ARM, for example, your mortgage rate will remain fixed for the first five years you have the loan, and then it will change once a year after that. ARM terms are typically 30 years.
"If you don't expect to be in your home for a long time and believe that rates are going to decline over the next couple of years, then the ARM is a good mortgage product to start with," Cohn says. "When rates bottom out, refinancing to the security of a fixed rate makes sense if you think you will be in the home long term."
15-year mortgage rates FAQs
Average 15-year mortgage rates have generally been in the upper 5% range in recent weeks, according to Zillow data.
The main benefits of getting a 15-year mortgage are a lower interest rate, less interest paid overall, and building equity faster. But the trade-off is that you'll have a larger monthly payment due to the shorter term.
Average mortgage rates are lower on 15-year mortgages compared to loans with longer terms. You'll also pay less interest because the term is shorter, so you'll spend less time accruing interest.
Yes, it's not uncommon for borrowers to refinance into a shorter term like a 15-year mortgage to lower their interest costs.
Yes, 15-year mortgages come with larger monthly payments, which can potentially put a strain on borrowers' budgets and limit how much they can afford to borrow.
You should get rate quotes from multiple mortgage lenders to be sure you're getting the best rate. Improving your credit score and having a larger down payment will also help.
Yes, there are many low down payment mortgages that include 15-year term options. You could put as little as 3% down with a conventional loan.
What's a Zestimate?
