Quote:
Originally Posted by David70
I looked at this and if you can swing the 15 year it still has additional benefits besides just the rate.
$300k at 3% - 30 year term and at the end of the first 12 payments you have spent $8900 in interest
$300k at 2.5% - 15 year term and at the end of first 12 payments you have spent $7300 in interest
You can add more money to the 30 year loan to reduce the balance to the same level as the 15 year but you do anything about the $1605 you lost to interest (some of this is the interest, some the issue of the term). As time goes on these differences get smaller but it is still money lost as a larger part of the 30 year loan payment is going towards interest. Even if they were the same rate the 30 year would have you behind some amount.
https://www.bankrate.com/calculators...alculator.aspx |
Yeah, that is the question. If I go 30y and make the same payment I would have had on the 15yr, I end up paying over $25k more in interest over the 15.7 years it takes to pay off the loan.