15-year against 30-year
30 years gives $2,528.27. 15 years gives $3,484.43 — a difference of $956.16 more (+37.8%).
The shorter term costs more every month and far less in total. The gap is the whole argument.
| Input | 30 years | 15 years |
|---|---|---|
| Loan amount(usd) | 400,000 | 400,000 |
| Annual interest rate(percent) | 6.5 | 6.5 |
| Term(years) | 30 | 15 |
| Home value(usd) | 500,000 | 500,000 |
| Property tax a year(usd) | 6,000 | 6,000 |
| Home insurance a year(usd) | 1,800 | 1,800 |
| HOA dues a month(usd) | 0 | 0 |
| First payment | 20,697 | 20,697 |
| Property tax and insurance rise by(percent) | 3 | 3 |
| PMI rate a year(%) | 0.55 | 0.55 |
| Monthly principal & interest | $2,528.27 | $3,484.43 |
Loan balance over time, side by side
Every figure, both ways
| Step | 30 years | 15 years | Difference |
|---|---|---|---|
| Number of payments(payments) | 360 | 180 | -180 |
| Monthly principal & interest | 2,528.27 | 3,484.43 | +956.16 |
| Total paid over the term | 910,177.95 | 627,197.3 | -282,980.65 |
| Total interest | 510,177.95 | 227,197.3 | -282,980.65 |
| Loan against value(%) | 80 | 80 | 0 |
| PMI applies | 0 | 0 | 0 |
| PMI a month | 0 | 0 | 0 |
| Property tax a month | 500 | 500 | 0 |
| Insurance a month | 150 | 150 | 0 |
| Full monthly payment (PITI) | 3,178.27 | 4,134.43 | +956.16 |
| Above principal and interest(%) | 25.71 | 18.65 | -7.05 |
| Balance at which PMI must stop | 390,000 | 390,000 | 0 |
| PMI drops off after(months) | 0 | 0 | 0 |
| PMI paid before it drops | 0 | 0 | 0 |
| Paid off on | 31,654.28 | 26,175.64 | -5,478.64 |
| Property tax a month in ten years | 671.96 | 671.96 | 0 |
| Insurance a month in ten years | 201.59 | 201.59 | 0 |
| Full payment in ten years | 3,401.82 | 4,357.98 | +956.16 |
| Half payment, every two weeks | 1,264.14 | 1,742.21 | +478.08 |
| What that adds up to a month | 2,738.96 | 3,774.8 | +1,035.84 |
| Months to payoff paying biweekly | 289.83 | 157.95 | -131.88 |
| Years cut off by paying biweekly(years) | 5.85 | 1.84 | -4.01 |
| Interest saved paying biweekly | 116,342.76 | 30,953.8 | -85,388.96 |
Questions people actually ask
- Does lowering term change the answer in proportion?
- No, and that is the point of putting them side by side. Term changes by 50% while monthly principal & interest changes by 38%. The step table below shows which line breaks the proportion.
- What is held constant between the two columns?
- Everything except term: loan amount, annual interest rate, home value, property tax a year, home insurance a year, hoa dues a month, first payment, property tax and insurance rise by, pmi rate a year. That is what makes the difference attributable — change two things at once and neither column tells you which one moved the answer.
- Can I compare my own two numbers?
- Yes, from the address bar: add ?a.years=… and &b.years=… to set each side, and a parameter without a prefix sets both at once. The page is computed per request, so any pair works — these two are only the ones worth a link.
Change either side by adding query parameters — ?a.years=… and b.years=…. A parameter without a prefix sets both sides at once. Source: CFPB — understanding loan options and amortization, Federal Reserve — consumer mortgage information, US CFPB — when private mortgage insurance must be cancelled (Homeowners Protection Act)