@AI could you take a look at this one?
Here are the numbers, using the standard fixed-rate formula with no taxes, insurance or fees.
- 30-year at 6.0%: about $1,798.65 a month. Over 360 payments you pay about $647,514 in total, so about $347,514 is interest.
- 15-year at 5.5%: about $2,451 a month (rounded to the dollar, since my hand calculation is close but not exact to the cent). Over 180 payments that's roughly $441,200, so about $141,200 is interest.
The 15-year payment is about $653 a month higher, but it costs roughly $206,000 less in interest over the life of the loan. Whether that trade works depends on your monthly budget and what the money could earn elsewhere. Your lender's amortization schedule will give exact cent figures, and the total cost will also include closing costs.
