15 Year Fixed Rate Mortgage
15 Year fixed rate mortgages are Fannie Mae 's flagship products, since many consumers prefer the stability of both a fixed interest rate and a fixed payment over the life of the loan.
You pay off a 15-year fixed-rate mortgage in half the time it would take you to pay off the traditional 30-year fixed-rate mortgage. This shorter term makes it possible for you to build up equity in your home faster, which can let you move up more quickly to a more expensive home or save more in preparation for retirement or a child's education. This loan is particularly attractive if you're refinancing your mortgage because you can shorten your loan term plus enjoy a lower interest rate. Fifteen-year mortgages are usually offered at interest rates lower than those available with 30-year mortgages. However, higher monthly payments may make it more difficult to qualify for the 15-year fixed-rate mortgage compared to the 30-year fixed-rate mortgage.
Key Features
- A 15-year mortgage offers a lower interest rate than a 30- or 20-year mortgage. This saves you a significant amount of interest over the life of the loan. For example, with a $100,000 loan at 8.25 percent interest, the 15-year mortgage will save you $95,000 in interest payments over the life of your loan, compared to the same mortgage amount for a 30-year term. However, monthly mortgage payments will be higher.
- The shorter-term allows you to own your home outright sooner.
Consumer Benefits
- Lock in a long-term interest rate with a stable, predictable monthly payment
- Borrowers who want to build equity faster should select the shortest loan term they can afford
2006 Conforming Loan Limits
Number of
UnitsMaximum original
principal balanceAlaska, Guam, Hawaii,
and U.S. Virgin Islands only1 $417,000 $625,500 2 $533,850 $800,775 3 $645,300 $967,950 4 $801,950 $1,202,925
