15-Year vs 30-Year Mortgage

Most mortgage comparisons stop at the monthly payment, which is exactly where the 30-year term looks best and exactly where the comparison becomes useless. A mortgage has two prices: the one you feel each month, and the one you pay in total over the life of the loan. This page puts both prices on the same loan, at the same moment's rates, side by side — then prices the middle path most comparisons skip: taking the 30-year loan and paying it as if it were a 15.

The rates and the rules behind every number on this page

Every figure below uses Freddie Mac's Primary Mortgage Market Survey for the week ending October 29, 2026: 7.24% for a 30-year fixed-rate mortgage and 6.60% for a 15-year — a spread of 0.64 percentage points. These are national averages for conventional, conforming purchase loans with 20% down and excellent credit, published by Freddie Mac; your own quote will differ, but the pattern below — a lower rate on the shorter term — is a standing feature of the market, not a quirk of this week.

The worked example is one loan of $400,000, taken once at each term, fixed at that term's rate for its whole life. Payments are principal and interest only — no property taxes, homeowners insurance or PMI, which depend on the property and the down payment rather than the term. (On a loan with less than 20% down, PMI is part of the early years of either term; how to get rid of PMI shows when it legally has to end.) Our full methodology is on how we calculate.

The side-by-side: one loan, two terms

Read the last row first. The 30-year loan's interest bill — $581,357.32 — is larger than the $400,000 originally borrowed. You repay the house, and then you repay most of a second one. The 15-year loan's interest, $231,162.18, is still a serious amount of money, but it is 60.2% less. The difference between the two, $350,195.14, is what the lower monthly payment actually costs when it is stretched across three decades.

The monthly row runs the other way, and it is not a small consolation prize. $780.46 a month — $9,365.52 a year — is real money in a real budget: it is the difference between a payment that strains a household and one that leaves room for everything else a household has to pay for. Any honest comparison has to hold both rows in view at once.

Where the interest gap comes from

The $350,195.14 gap is built from two separate savings, and it helps to know which is which. The first is the rate: at 6.60% instead of 7.24%, every dollar of balance costs less to carry, every month. Lenders offer that lower rate on shorter terms because their money is committed for half as long — fewer years in which rates, inflation or a borrower's life can move against the loan.

The second saving is speed. On the 15-year schedule, principal is repaid aggressively from the first payment, so the balance — the thing interest is charged on — falls fast. On the 30-year schedule, the early payments are mostly interest and the balance barely moves. Interest is charged on what you still owe; the term that shrinks what you owe fastest pays the least of it, twice over.

The equity gap: five and ten years in

Five years in, the 30-year borrower has repaid $22,523.78 of principal; the 15-year borrower has repaid $92,571.00 — an equity gap of $70,047.22 before any change in the home's value either way. Ten years in, the 15-year loan is more than half gone while the 30-year balance has fallen by less than $55,000. This matters beyond the interest: equity is the borrower's cushion. It is what makes refinancing possible on good terms, what ends PMI (see how to get rid of PMI), and what is left if the home has to be sold in a flat market.

The third path: a 30-year loan paid like a 15

There is a middle option, and it deserves honest pricing rather than slogans. Take the 30-year loan — required payment $2,725.99 — and voluntarily pay the 15-year amount, $3,506.46, every month. The loan clears in 194 months, about 16 years and 2 months, with $279,448.34 in total interest.

Compare that carefully with the true 15-year. The voluntary path takes 14 months longer and costs $48,286.16 more in interest — because the rate stays at 7.24% instead of dropping to 6.60%. That $48,286.16 is the exact price of the flexibility the 30-year contract gives you: in a month when income drops, the required payment is $2,725.99, not $3,506.46, and nothing is late. Whether that insurance is worth $48,286.16 spread over 16 years is a judgment about the stability of your income — the arithmetic can only hand you the price tag, which it now has.

The honest trade-offs, stated plainly

Cash flow. The 30-year term leaves $780.46 more in the household's hands every month. That room can be the difference between coping with a job loss and missing payments — and a missed-payment spiral costs more than interest-rate arithmetic ever will. A payment that only works in good months is not a saving.

Opportunity cost, without the fantasy. That same $780.46 a month is money the 15-year borrower does not have available for anything else — an emergency fund, a car bought without a loan, a business, or investments. This page puts no return figure on any of those uses, because no return is guaranteed and inventing one would rig the comparison. What can be said exactly: the 15-year's saving of $350,195.14 is locked into the contract the day it is signed, while every alternative use of the $780.46 carries its own risk and its own discipline problem — the money has to actually go there, every month, for years.

Discipline. The 15-year term enforces its own payoff: the higher payment is the contract, not a resolution. The 30-year-plus-extra path delivers nearly the same destination only if the extra is paid in month 40 and month 90 with the same reliability as month 1. The profiles in our Mortgages & Housing hub return to this point: the best schedule is the one that survives contact with a real household budget.

Rates move. Both rates on this page are one week's national averages. The level of mortgage rates is set by forces larger than any borrower — the subject of the Fed and your wallet — and a future refinance can change either loan's math. What does not change is the structure: at any given pair of rates, the shorter term will carry the lower rate, the higher payment and the far smaller interest bill.

What these numbers leave out

Property taxes and homeowners insurance are excluded from both columns because they do not depend on the term — the same house owes the same tax bill under either loan. PMI is excluded for the same reason, but note its interaction with the equity table: on a purchase with less than 20% down, PMI rides on top of the early payments of both terms, and the 15-year's faster equity build reaches the 20% threshold — where PMI can be cancelled — years sooner (the rules are in how to get rid of PMI). Closing costs, which can differ slightly by term and lender, are a closing-table figure, not a schedule figure, and are not estimated here. Finally, both loans are modeled as held to term; most real loans end early through a sale or refinance, which truncates the interest totals but preserves the ranking of every comparison on this page.