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15 vs 30 year mortgage

Home Mortgages and Home Buying 15 vs 30 year mortgage

  • ENT Doc ENT Doc 
    Participant
    Status: Physician
    Posts: 3500
    Joined: 01/14/2017

    For those who care I did a 15 vs 30 comparison a while ago.  The interest deduction scenario assumes that all interest is deductible and that you’re able to save on the marginal tax rate (you’re already over the $24,000 standard deduction).  So if you’re in between your present value will fall somewhere in between the two results.  Should just need to input your 15 and 30 year rates, loan amount, and marginal investment return.  Enjoy.

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    Lordosis Lordosis 
    Participant
    Status: Physician
    Posts: 1807
    Joined: 02/11/2019

    We always know who to turn to for a great Excel sheet!

    “Never let your sense of morals prevent you from doing what is right.”

    #203461 Reply
    Zaphod Zaphod 
    Participant
    Status: Physician, Small Business Owner
    Posts: 6177
    Joined: 01/12/2016

    Does this logic extend to student loan debt or others? The conventional wisdom seems to be to drop student loans ASAP, but you could refinance to 15 years instead of 5 and invest the difference.

    Click to expand…

    Mortgages due to their usually high value (though student loans compete for us here), long terms available which leads to imputed rent income, tax benefits and generally the lowest rates you can get amongst loans gets special billing. You will also always need a place to live so there is a constant cost to housing regardless of whether or not you have paid it off, not the case with the others generally.

    Also agree that if extended everywhere in life you have a very high fixed costs burden and limit your liquidity for emergencies, savings, etc…

    #203640 Reply

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