15-year fixed-rate mortgage
What is it? This mortgage typically offers lower interest rates than its 30-year fixed-rate counterpart because banks don't have to price in as much long-term inflation risk. Borrowers who purchase a 15-year fixed-rate mortgage must pay off the loan more quickly. But they also build equity faster than homeowners with 30-year mortgages.
Who is it good for? Buyers of less expensive homes who hope to avoid a big chunk of interest costs by paying back the mortgage faster. This loan also appeals to homeowners seeking to refinance their mortgages without extending the term back out to 30 years.