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How to Pay of a 15 Year Mortgage Early and Fast!

By: John Bottel

For many home buyers, the only real decision they have to make is whether to have a 15 or 30 year fixed mortgage rate? Many people wait until they are older before taking on the responsibility of a mortgage so an early payment of this large debt is an important issue to think about. But, before you commit yourself and sign any documents, there are points you need to think about. One point to remember is ensuring that your monthly mortgage repayment remains the same throughout the entire period of the loan.

It seems that some lenders are happy to offer deals that appear too good to be true and they usually are. Loans agreed with a 15 year fixed mortgage keep the same interest rate throughout the entire life of the agreement.

If you are someone that wants a loan with a regular fixed repayment and no additional charges then this is the main benefit with this type of agreement. My wife and I looked into the loans available with 15 year fixed mortgage rates when we were searching for a home for sale.

Even though it was important for us to pay off our loan at the earliest possible opportunity, we did not want high, unrealistic monthly payments which we would have trouble maintaining.

Considering longer term fixed rate mortgages was one option if we could not afford a 15 year plan. Because we did not want to have a mortgage close to retirement, we hoped we would be able to afford a shorter 15 year fixed rate mortgage. Too much pressure was placed on the early repayment of the mortgage loan.

Taking everything into account we finally went for the easier 30 year mortgage plan instead. Many factors were taken into account when reaching this decision. The main reason was that I found out my wife was pregnant.

My wife decided she wanted to raise our child at home so I could not be certain of her monthly financial commitment to our household expenses. The downside to the 15 year fixed mortgage rate was the higher monthly repayment. We just decided we would probably get into trouble if we took this route. A thirty year loan brought the monthly payments down to a reasonable level.

We are also able to make extra payments throughout the year to make the principal shrink quicker. It is possible to take years off your loan if you can make a few extra payments during each year. It may be easier said than done, but this approach does pay off eventually. Our first choice would have been to go for the short term 15 year fixed rate mortgage solution but this did not help with our more immediate situation. In retrospect, everything worked out great for us by going down this road.

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