Direct Answer
A 15-year mortgage at 5.75% on a $300,000 loan saves roughly $234,000 in total interest compared to a 30-year mortgage at 6.5%, but the monthly payment is $595 higher — $2,491 vs. $1,896. An alternative is taking the 30-year and adding $400/month in extra principal, which pays off the loan in about 17 years while keeping the flexibility to lower payments if needed. Use the Amortization Calculator to compare both terms with your numbers.
Last verified on: June 21, 2026
Editorial note: This article compares 30-year and 15-year fixed-rate mortgages using current rate data from Freddie Mac and standard amortization calculations. It does not include property taxes, insurance, PMI (private mortgage insurance), HOA (homeowners association) dues, or closing costs. The right term depends on your budget, job stability, and long-term financial goals.
Research method: Daily Calcs modeled a $300,000 loan using the standard amortization formula. The 30-year scenario uses 6.5% (PMMS (Primary Mortgage Market Survey) average, late May 2026). The 15-year scenario uses 5.75% (typical 15-year spread vs. 30-year). Extra payment scenarios apply additional monthly principal only. All sources verified on June 21, 2026.
Side-by-Side Comparison: $300,000 Loan
| 30-year fixed | 15-year fixed | Difference | |
|---|---|---|---|
| Typical rate (mid-2026) | 6.5% | 5.75% | -0.75% |
| Monthly P&I payment | $1,896 | $2,491 | +$595 |
| Total interest paid | $382,560 | $148,380 | -$234,180 |
| Total cost of loan | $682,560 | $448,380 | -$234,180 |
| Years to payoff | 30 years | 15 years | -15 years |
P&I (principal-and-interest) only. Property tax, insurance, and PMI add the same amount to both scenarios.
The $595 Question: Is the Higher Payment Worth It?
To decide whether the 15-year term makes sense, compare what that $595/month could do for you in other ways:
| Use of $595/month | Outcome |
|---|---|
| 15-year mortgage payment | Saves $234,000 in interest, builds equity 15 years faster |
| Invest in S&P 500 index (7% avg. return) | Grows to roughly $325,000 over 30 years (before taxes) |
| Split: $300 extra payment + $295 invest | Partial interest savings + investment growth |
There is no universal right answer. The mathematically optimal choice depends on your expected investment returns versus your mortgage rate. The personally optimal choice depends on whether you prefer guaranteed savings (pay down debt) or potential growth (invest).
The Extra-Payment Alternative
Taking the 30-year and adding extra principal payments is a hybrid strategy that gives you the best of both terms:
| Strategy | Monthly payment | Payoff time | Total interest | Interest saved vs. 30-year |
|---|---|---|---|---|
| 30-year, no extra | $1,896 | 30 years | $382,560 | $0 |
| 30-year + $200/month | $2,096 | 23 years | $278,700 | $103,860 |
| 30-year + $400/month | $2,296 | 18 years | $212,900 | $169,660 |
| 30-year + $600/month | $2,496 | 15 years | $170,100 | $212,460 |
| 15-year (no extra) | $2,491 | 15 years | $148,380 | $234,180 |
Adding $600/month to a 30-year loan at 6.5% achieves roughly the same payoff time as a 15-year at 5.75%, but pays about $21,700 more in interest because the rate is higher. The advantage is flexibility — you can stop extra payments at any time.
How Loan Term Affects Amortization
The shape of your payment schedule changes dramatically between terms.
30-year amortization (6.5%):
- Year 1: $1,477 of every payment goes to interest, $419 to principal
- Year 15: $1,107 to interest, $789 to principal
- Year 29: $134 to interest, $1,762 to principal
15-year amortization (5.75%):
- Year 1: $1,418 of every payment goes to interest, $1,073 to principal
- Year 7: $990 to interest, $1,501 to principal
- Year 14: $237 to interest, $2,254 to principal
The 15-year loan shifts the balance toward principal much faster because the required payment is higher and the rate is lower. By year 7 of a 15-year loan, you are paying more principal than interest each month. On a 30-year term, that crossover does not happen until year 18.
When Each Term Makes Sense
Choose the 30-year if:
- You want the lowest possible monthly payment
- You plan to invest the payment difference
- Your income is variable or commission-based
- You are buying near the top of your budget
- You may sell within 5-10 years
Choose the 15-year if:
- Maximizing interest savings is your priority
- You have a stable income and emergency fund
- You want to own the home free and clear before retirement
- You are comfortable with a higher fixed payment
- You want to reach 20% equity (and drop PMI) faster
Calculator Methodology
All calculations use the standard fixed-rate amortization formula:
Payment = P * r(1 + r)^n / ((1 + r)^n - 1)30-year scenario: P = $300,000, r = 6.5%/12, n = 360 15-year scenario: P = $300,000, r = 5.75%/12, n = 180
Extra payments are applied to principal after the scheduled payment each month. Lower rate on the 15-year reflects the typical 0.50-0.75% spread over 30-year rates.
Related Reading
- Amortization Formula — payment math behind both term options
- Refinance vs Extra Payments — shorten term vs prepay on a 30-year
- Extra Payments Amortization Schedule — model added principal on a 30-year loan
- The 15-Year Mortgage Hack — pay a 30-year like a 15-year for flexibility
Official and Supporting Sources
- Freddie Mac PMMS (Primary Mortgage Market Survey), late May 2026
- CFPB (Consumer Financial Protection Bureau): What is a 15-year vs. 30-year mortgage?
- Fannie Mae: Conventional loan term options
- Daily Calcs Amortization Calculator
- How mortgage rates affect your monthly payment in 2026
- Refinancing vs. extra payments: Which saves more on your mortgage?
Next Step
Use the Amortization Calculator to compare 15-year and 30-year schedules with your loan amount and rate. Or try the Mortgage Calculator to see how the term choice affects your total monthly payment including property tax and insurance.
Frequently Asked Questions
30-year vs. 15-year mortgage: Which saves more interest?
A 15-year mortgage saves roughly $200,000 in total interest on a $300,000 loan compared to a 30-year term at the same rate. The trade-off is a monthly payment that is roughly 50% higher. If you can afford the higher payment, a 15-year term is the most interest-efficient choice.
Are 15-year mortgage rates lower than 30-year rates?
Yes. Fifteen-year fixed rates are typically 0.50% to 0.75% lower than thirty-year rates because the lender's risk period is shorter and the loan pays off faster. In mid-2026, Freddie Mac PMMS (Primary Mortgage Market Survey) data showed fifteen-year rates around 5.75% to 6.0% compared with roughly 6.5% for thirty-year loans — a spread that partially offsets the higher monthly payment on a shorter term.
Should I get a 30-year mortgage and make extra payments instead of a 15-year?
This can work well if you want payment flexibility. A 30-year loan at 6.5% with $400/month in extra principal pays off in roughly 17 years and saves about $190,000 in interest — close to a 15-year result. The key advantage is that you can reduce or stop extra payments if your financial situation changes.
How much higher is the monthly payment on a 15-year vs. 30-year mortgage?
On a $300,000 loan at current rates, a 30-year payment at 6.5% is $1,896. A 15-year payment at 5.75% is $2,491. That is $595 more per month — a 31% increase. However, total interest on the 15-year is $148,380 versus $382,560 on the 30-year, saving $234,180.
Can I refinance from a 30-year to a 15-year mortgage later?
Yes. If you take a 30-year now and later want to switch, you can refinance into a 15-year loan. This approach lets you lock in lower initial payments and only commit to the higher 15-year payment when you are more financially secure. Closing costs typically range from 2% to 5% of the loan amount.
Who should choose a 15-year mortgage over a 30-year?
A 15-year mortgage makes sense if you have stable income, a healthy emergency fund, and maximizing interest savings is your priority. A 30-year is better if you want lower monthly payments, plan to invest the difference, or expect income fluctuations. The Amortization Calculator can show both schedules side by side.
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