FIXED-RATE MORTGAGE: Every payment reduces the balance of your mortgage so that your loan is paid off at the end of its term. The payments remain the same through out the life of the mortgage, which provides a security that many people prefer.

30 YEAR MORTGAGE TERM: People often choose this term because, with 30 years to pay off the mortgage, payments are less than, say, a 15 year mortgage term. This means you can afford a nicer home for less money per month than with a similar program with a lesser term.

15 YEAR MORTGAGE TERM: This is a great program for people that can afford the payments. Since the interest rates for 15 year mortgage terms are almost always less than those of 20 or 30 year terms and because you are paying interest for a fewer number of years, you can save a significant amount of money with this program. These savings make it popular with a number of people considering refinancing their mortgage.

10 YEAR MORTGAGE TERM: This program has the same rate as the 15 year mortgage term, so its primary benefit is that you save due to paying interest for fewer years. The payments are a little higher than for the 15 year term, ofcourse.

20 YEAR MORTGAGE TERM: This program has the same rate as the 30 year mortgage term, so its primary benefit is that you save due to paying interest for fewer years. The payments are a little higher than for the 30 year term, ofcourse.

A COMPARISON: Payments for a $250,000 mortgage

30 year fixed at 7% = Payments of 1663 with a total pay-off of 598,772
20 year fixed at 7% = Payments of 1938 with a total pay-off of 465,179
15 year fixed at 6.625% = Payments of 2195 with a total pay-off of 395,097
20 year fixed at 6.625% = Payments of 2855 with a total pay-off of 342,555



As you can see, the 'better' program is really the one that best fits your needs: Is your goal to have a lower payment? To save the most money? Or somewehere in between...