The monthly repayments for 30 year or 15 year fixed mortgage are just one important consideration for many people who are looking to buy a home. No-one wants a mortgage hanging around their neck forever but with home buyers entering the market later, an early repayment of this loan is important. But, before you commit yourself and sign any documents, there are points you need to think about. A homeowner should pursue, wherever possible, a mortgage with a guaranteed interest rate.

Avoid the mortgage loans offered by some lenders, those that sound unbelievable because they usually are. Loans agreed with a 15 year fixed mortgage keep the same interest rate throughout the entire life of the agreement. The greatest benefit with this type of agreement is that there are no sudden unexpected amounts to pay. When we were looking to buy a home, my wife and I decided to go for a loan with a 15 year fixed mortgage rate.

Even though it was important for us to pay off our loan at the earliest possible opportunity, we did not want high, unrealistic monthly payments which we would have trouble maintaining. So in consideration of this point we also looked at longer, 30 year fixed rate mortgages as well. No-one likes the idea of having a mortgage when they are close to retirement, and we were no different, so it was still our hope that a 15 year fixed mortgage rate plan would still be an option. We were worried about the emphasis placed on early completion of the mortgage.

Eventually we decided on a 30 year loan after looking at all the other possibilities. There were many things that lead us into making this choice. Finding out my wife was having a baby made making the choice so much easier! The contribution my wife made to the monthly finances would be unreliable since she intended to raise our child at home. The problem we could see was the increased financial commitment on a monthly basis if we had opted for the 15 year fixed mortgage rate. For us it just was not feasible as we would just be in over our heads. The 30 year loan repayments were considerably lower than the 15 year figures.

Being able to make additional lump sum payments during the year means the outstanding loan reduces faster. By doing this you can also reduce the term of the mortgage by quite a few years. This is well worth it in the long term but it does require some discipline. It was hard going against our preference for a shorter term, 15 year fixed rate mortgage, but we had to think about more immediate needs and abilities. As it is, things worked out very well for us by taking this route.

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