We are about to purchase a home and arrange for a mortgage on this home. We have an option to go for either a short term mortgage of 15 years, a medium-term of 20 or a long term mortgage of 30 years. The 30-year mortgage has the lowest monthly payments. However we pay the most interest with a 30-year mortgage. We are wondering what we should do. We can afford to pay the increased payments of a 15-year mortgage. As consumers we are also a little afraid of a long term mortgage since we will take a long time to build up any equity on our home from our monthly payments. We understand that virtually no equity will be built up in the first ten years of the mortgage, so we are tending to lean towards a shorter mortgage.
Do you currently have a mortgage? :: No, this is our first mortgage
Home/Mortgage Loan Amount :: $150,000
Other Loans, Including Credit Cards:: Nothing significant, we pay our credit cards fully every month. Our car is fully paid for.
Are you employed and for how long:: I graduated from a university and have been working for one year so far.
Your credit rating to be – excellent, fair, or bad? :: Great, we think
Gross Amount Per Paycheck:: $1500 every two weeks
Do you agree to have this information published online, without your PRIVATE information, of course? :: Sure, I guess so
We have been able to save the down payment that is needed as well in our first year. We currently rent a place and want to get a place of our own and build up equity. This is a first time for us and it is a big deal to take on a huge mortgage like this so we appreciate any advice that you can provide to us.
This is probably the biggest deal of our lives and will affect us for the next 30 years so what should we do? go for a 30 year mortgage or something shorter? We need an answer quickly on this question since we are in the process of arranging for a mortgage and must make a decision within the next few days.
If you have a question about debt, loans , mortgages or other financial situations, please feel free to leave a comment with as much detail about your situation as you can. We will try to answer your question in our next post. For more information about new mortgages, click here.
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In Canada the longest mortgage you can get is a 25 year mortgage , 30 year mortgages are no longer legal
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