The confusion of choosing between a 15 year mortgage and 30 year has been a common one prevailing among borrowers. Today i am going to throw some light on why a 15 year mortgage is better even if you have to increase your monthly installments and suffer for a few years.

When we have 30 years to pay a loan why should we take the trouble of paying it off in 15 years by increasing our monthly interest and suffering to make the ends meet every month? Well here is the reason.

One of the major advantages of opting for a 15 year mortgage is the lesser amount of total interest paid apart from its rate of interest being typically lower compared to the 30 year mortgage.Initially the money you pay is accounted only for the interest. As years go by the interest you pay on a monthly basis is allotted to compensate for the principal.

Imagine a person has taken a FRM for 15 years at the rate of 5% and another person for 30 years at the rate of 5.25% for a principal of  $200,000, lets see what happens:

15 year    30 year

Monthly Payment                     $1581        $1104

Interest Paid                               $84,686       $197,587

Total                                                $284,686     $397,587

With a 15 year mortgage you save about $112,901 which can be used for a constructive purpose.

Are the services of a mortgage broker essential for you? Is it impossible for you to secure a good mortgage deal on your own? These are very relevant questions as a cunning mortgage broker can actually deteriorate your financial condition rather than help you build towards attaining your goals in life. Lots of people hire a mortgage broker in the hope that the broker will be able to help them secure a good mortgage deal. The fact is that, it is better to do some research on the mortgage market and compare the features provided by various companies on your own than seek the services of a mortgage broker to get a loan that fits your requirements.

The over-dependence of people on mortgage brokers may have even contributed considerably to the ongoing economic crisis. Dispensing with a mortgage broker can help you save time and keep more bucks in your wallet. Mortgage brokers can easily trick you if you are not vigilant. They will make you think that their service is very helpful for you. You will be made to believe that they are valuable to you and they are providing you very useful financial inputs. What they are actually doing is that they are utilizing you as a money-making source with little regard given to your cause.

Home-Account.com is an online resource that will help you immensely in avoiding the services of a mortgage broker. This is an acclaimed and credible site that has been featured in the prestigious PC Magazine. It enables different consumers to choose the mortgage that best suits their preferences. This site gives guidance that accounts for the specific financial condition of different customers. In addition, it will assess your financial condition and allot you a “grade” that reflects how much qualified you are to get a good mortgage deal.

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June 4th sale of mortgage backed securities pushed mortgage rates higher. A highly eventful week witnessed MBS coupon price move 200 basis points low early last week and conversely raising the thirty year fixed rate from 4.87 percent to 5.37 percent by weekend. The thirty year fixed rates were at a 4.62 percent before May 27th Black Wednesday.

To the market, this could very well mean the onset of recovery. Stock market is witnessing a positive change in the mood of investors who were investing in low risk assets like treasury debt are now attempting to invest in assets that yield higher returns. 

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