Is 15-year mortgage better choice than 30-year?

3 Apr

Chicago Tribune – Ilyce Glink & Samuel Tamkin

Q: I’m a fairly young homeowner (just 30 years old). I bought my house in 2010 in Las Vegas at a great price because of the housing bust. I was also fortunate enough to get a great interest rate of 4.25 percent. I only owe about $153,000 on my home to be paid out over the next 26 years.

Recently, I found out I am eligible to refinance my house at 3.47 percent for 15 years and this would only increase my monthly payment by $200 per month. The idea of being mortgage free at 45 years old sounds amazing to me.

However, I’m being told by some that because I’m so young and based on inflation, I should keep my current mortgage because my money is worth more now. What should I do?

A: It sounds like you’re in a great place with regard to your finances. We also like that you’re considering a 15-year mortgage because you will quickly build up equity and pay off your loan in a short period of time.

But while we like 15-year mortgages and think that for some people that shorter term financing on a home will ultimately be a huge benefit, it’s not right for everyone. But let’s take a closer look at your options.

If we assume…

>> Read More: http://www.chicagotribune.com/classified/realestate/sns-201403310900–tms–realestmctnig-a20140403-20140403,0,3418346.column

Visit my website at: www.juliecnichols.com

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