- 15-year mortgage
- A fixed-rate loan repaid in 180 monthly payments. The payment is higher than on a 30-year loan because principal is repaid twice as fast, but lenders usually offer a lower rate and far less interest accrues. This calculator computes its payment and total interest at the 15-year rate you enter.
- 30-year mortgage
- A fixed-rate loan repaid in 360 monthly payments, the most common U.S. home loan. Spreading repayment over twice as long lowers the monthly payment, but the balance stays higher for longer and the rate is usually higher, so total interest is much larger. The calculator uses the 30-year rate you enter.
- Loan term
- The number of years over which the loan is scheduled to be repaid in equal monthly payments. A longer term lowers each payment but keeps the balance outstanding longer, so total interest rises. This calculator holds the loan amount constant and compares the two most common terms side by side.
- Interest rate
- The annual percentage the lender charges on the unpaid balance, not including fees. Shorter terms usually carry a lower rate because the lender’s money is at risk for less time. This calculator takes a separate rate for each term, so enter the rate actually quoted for each one.
- Total interest
- The sum of all interest paid over the full term if the loan runs to maturity with regular payments: total payments minus the loan amount. The calculator shows it for each term; the gap between the two is the main cost of choosing the lower 30-year payment.
- Interest saved with 15-year
- The 30-year loan’s total interest minus the 15-year loan’s total interest. It combines two effects: the shorter repayment period and, usually, the lower rate. The figure assumes both loans are kept to maturity with no extra payments or refinancing. Paying off either loan early would change both totals.
- Extra monthly cost of 15-year
- How much more the 15-year payment is each month compared with the 30-year payment. It is the budget trade-off for the interest savings. The calculator compares principal and interest only; taxes and insurance are the same under either term and are left out.
- Amortization
- Paying off a loan through equal periodic payments that cover interest first and then principal. On a 30-year schedule, early payments are mostly interest and equity builds slowly; on a 15-year schedule a larger share of each payment reduces principal from the start. Both payments here come from the standard amortization formula.
