12 Jun Holly Walther Lending Team: Fun Fact Friday – Choosing a Mortgage Term Length
Holly: Hey guys, happy Friday! It’s Holly, and look here! The real little miss Daisy is back with us in the office this week. So, we are here with today’s fun fact Friday, and I’ve been getting a lot of questions lately in this current environment. Like, does it make sense to do a 15 or 20 or 30 year mortgage if my goal is to pay my mortgage off early? Well, great questions. And my opinion is, it really depends on where you are in your life and what your long-term goals are. A lot of people think they have this mindset because perception is reality that they have to do a 15 year to make any headway with their mortgage.
Well, that’s not necessarily true, and we don’t need to focus so much on that if that is going to put you in an uncomfortable position. Are you pushing yourself too hard to commit to that 15 year mortgage? And maybe you have little children that are going to need braces, that are going to be playing sports. Maybe your children are older and they’re going to be going off to college. So don’t get so laser focused on putting the pressure on yourself to commit to a 15 year mortgage. You could do a 30 year mortgage. Pay extra towards principle. We all know in the beginning of a mortgage, the majority of your payment is going to interest every month.
So, make one additional payment towards principal each year. One additional payment, that cuts eight years off of your mortgage. Because keep in mind our lives change. Where you are today isn’t where you’re going to be next week or next year. So just be mindful of that when choosing a term. Of course, if you go with a 15 year, are you going to pay it off faster? Absolutely. Are you going to pay less interest? Absolutely. But could we put together some strategies that don’t make you commit to that higher payment, to still accomplish a lot of those goals? Absolutely. So there you are. There’s your fun fact Friday go make it a great weekend and be sure to check us out next week.