On a $300,000 mortgage at 6%, a 30-year term costs $347,515 in total interest (Fixture A, engine-verified). A 15-year term at the same 6% costs approximately $155,700 in total interest — a difference of roughly $192,000. The 15-year payment is approximately $2,531/month vs $1,798.65 for the 30-year — about $732/month more.
Those numbers are the starting point, not the whole story. The real question is what you would do with the $732 monthly difference — and whether the 30-year's flexibility or the 15-year's discipline is worth more to you. The calculator shows both schedules side by side for your actual loan amount and rate.
The $192,000 interest gap — and why it compounds
The 15-year mortgage's massive interest advantage comes from two sources: a shorter period (180 months vs 360) and — in practice — a lower interest rate (lenders typically charge 0.5–0.75% less for 15-year loans). In the calculator above, both terms use the same 6% rate for an apples-to-apples comparison; in the real market, the 15-year's advantage is even larger.
The compounding effect matters too. By paying off in 15 years, you stop generating interest on your outstanding balance 15 years earlier. Every extra month of a 30-year mortgage adds interest on a balance that would already be zero under the 15-year.
For context, $192,000 at the same 6% rate invested for 30 years grows to roughly $1.1 million. The interest you save on the mortgage is not just money kept — it is a principal that could itself compound if deployed elsewhere.
The case for the 30-year mortgage
The 30-year's biggest advantage is not financial — it is optionality. A 30-year borrower who invests the $732 monthly payment difference into an index fund at historical market returns may come out ahead of the 15-year borrower, purely on numbers. The 15-year is a forced savings mechanism; the 30-year requires the discipline to actually invest the difference.
The 30-year also provides a lower required minimum payment. In months when income drops — job loss, illness, family changes — the lower contractual obligation is a genuine safety valve. A 15-year borrower who cannot make the higher payment is in default; a 30-year borrower facing the same shortfall has more margin.
The honest answer: if you will reliably invest the payment difference, the 30-year can be mathematically competitive at low rates. If the extra $732 would be spent rather than invested, the 15-year wins both the math and the behavioral game.
Using the compare mode for other term pairs
The calculator is not limited to 15 vs 30. Change the "Alternative term" field to compare any two terms: 20-year vs 30-year, 10-year vs 15-year, or any custom combination. The side-by-side balance chart shows both loan payoff curves simultaneously, making the equity-building difference visual.
A 20-year term at 6% on $300,000 produces a payment of approximately $2,149/month and total interest of roughly $215,800 — a middle ground between the 15- and 30-year options. Use the compare mode to find the term that fits your budget and goals.
Frequently asked questions
Is a 15-year mortgage always better than a 30-year?
Not always. The 15-year wins on total interest paid and speed of equity building. The 30-year wins on monthly payment flexibility and — if you reliably invest the payment difference — potentially on total wealth. The right choice depends on your income stability, investment discipline, and how long you plan to stay in the home.
What is the payment difference between a 15-year and 30-year mortgage on $300,000?
At 6%, the 30-year payment is $1,798.65/month (engine-verified, Fixture A). The 15-year payment at 6% is approximately $2,531/month — about $732/month more. In practice, 15-year mortgage rates are typically 0.5–0.75% lower, which narrows the payment gap: a 15-year at 5.5% on $300,000 costs approximately $2,451/month — about $652 more than the 30-year at 6%.
How much interest do I save with a 15-year vs 30-year mortgage?
On $300,000 at 6% for both terms: 30-year costs $347,515 in total interest (Fixture A); 15-year costs approximately $155,700 in total interest — a difference of roughly $192,000. With the typical rate advantage (15-year at 5.5% vs 30-year at 6%), the interest saved rises further.
Can I get the benefits of a 15-year mortgage without the higher payment?
Yes — by taking a 30-year mortgage and making extra principal payments equal to the difference. On $300,000 at 6%, paying an extra $732/month on the 30-year accelerates payoff to roughly 15 years and produces similar total interest. The advantage of this approach is flexibility: in a tight month, you can skip the extra payment. The disadvantage is that the discipline to consistently pay the extra is not guaranteed.
Worked examples
Standard comparison — $300,000 at 6.5%
$300,000 loan: 30-year at 6.5% vs 15-year at 6.5%. Pure term comparison holding rate constant to isolate the effect of the term.
30-yr payment
$1896.20
15-yr payment
$2613.32
Extra per month
$717.12
Interest saved (shorter term)
$212,235
30-year: $1,896.20/month, $382,432 total interest. 15-year: $2,614.27/month (+$718.07), $170,569 total interest. Choosing 15 years saves $211,863 in interest — 70% of the loan principal — in exchange for $718/month more. If the $718 payment difference were invested at 7% for 15 years, it would grow to approximately $220,000 — nearly matching the interest saving, so the 30-year investing-the-difference argument is a genuine tie at typical market assumptions.
Higher balance — the jumbo decision
$450,000: 30-year at 7% vs 15-year at 7%. Shows how the payment gap and interest saving scale with loan size.
30-yr payment
$2993.86
15-yr payment
$4044.73
Extra per month
$1050.87
Interest saved (shorter term)
$349,739
30-year: $2,993.72/month, $627,739 total interest. 15-year: $4,044.23/month (+$1,050.51), $277,960 total interest. Interest saving by choosing 15 years: $349,779 — more than the loan amount itself. But the $1,050 payment gap is significant; a household that cannot comfortably service the higher payment should not choose 15 years for the theoretical savings alone.
Starter home — the affordability tradeoff
$200,000: 30-year at 6% vs 15-year at 6%. Smaller loan, same rate. Shows when the payment difference is more manageable.
30-yr payment
$1199.10
15-yr payment
$1687.71
Extra per month
$488.61
Interest saved (shorter term)
$127,888
30-year: $1,199.10/month, $231,676 total interest. 15-year: $1,687.71/month (+$488.61), $103,788 total interest. Interest saving: $127,888. On a smaller loan, the $488 payment difference is more manageable relative to income, and the 15-year rate advantage (typically 0.5–0.75% below the 30-year) is not modeled here — adding it to the 15-year would widen the interest saving further.
Interest saved by choosing 15-year over 30-year mortgage
Total lifetime interest savings (30yr interest − 15yr interest). Does not include the 15yr rate advantage, which typically adds further savings in practice.
| Loan amount ($) | 5.5% | 6% | 6.5% | 7% | 7.5% |
|---|---|---|---|---|---|
| $200k | $115k | $128k | $141k | $155k | $170k |
| $300k | $172k | $192k | $212k | $233k | $255k |
| $400k | $229k | $256k | $283k | $311k | $339k |
| $500k | $287k | $320k | $354k | $389k | $424k |
| $600k | $344k | $384k | $424k | $466k | $509k |
Rate is held constant between terms here to isolate the term effect. In practice, 15-year rates are typically 0.5–0.75% below 30-year rates, increasing savings further.
What affects your loan outcome
Monthly payment tolerance
The 15-year payment is roughly 35–50% higher than the 30-year on the same balance and rate. This is not a theoretical concern: households whose income does not comfortably support the higher payment risk financial stress, and a missed payment on a 15-year mortgage carries the same consequences as on a 30-year. The right comparison is whether the payment gap — not the interest saving — is within your budget with adequate margin.
Rate differential between terms
In most market environments, 15-year mortgage rates are 0.5–0.75% below 30-year rates. This compounds the interest saving beyond what a constant-rate comparison shows: a 15-year at 6% vs a 30-year at 6.75% saves even more than the same-rate comparison suggests. Use lender quotes for both terms simultaneously to get the real comparison with the actual rate differential.
What you would do with the payment difference
If the $500–$800 monthly difference between a 15-year and 30-year payment would be invested consistently in a diversified index fund, historical evidence suggests you might accumulate more wealth over 30 years by choosing the 30-year and investing the difference, particularly in low-rate environments. However, this requires sustained investment discipline. If the extra cash flow would be spent rather than invested, the 15-year forced savings wins.
More loan questions
Is a 15-year or 30-year mortgage better?
There is no universal answer — the right choice depends on your payment tolerance, income stability, investment discipline, and rate environment. The 15-year saves dramatically on total interest and builds equity faster, but costs 35–50% more per month. The 30-year keeps cash flow flexible and allows you to invest the difference — though it requires discipline to actually do so. Use this calculator to see both scenarios with real numbers for your loan size and rate.
Can I pay off a 30-year mortgage in 15 years?
Yes. A 30-year mortgage can be paid off in approximately 15 years by making extra principal payments equal to the payment difference between the two terms. This gives you the payment flexibility of a 30-year (you can drop back to the minimum in tight months) while building equity at roughly the same pace as a 15-year when you pay extra consistently. The downside: you will likely pay a slightly higher rate than the 15-year product, so the total cost is between the two scheduled scenarios.
What is a 20-year mortgage and is it a better compromise?
A 20-year mortgage splits the difference: the payment is roughly 15–25% higher than a 30-year (less of a stretch than a 15-year), total interest is substantially lower than a 30-year, and equity builds much faster. The 20-year is offered by most US, UK, and Australian lenders, though it is not as prominently featured as 15 and 30. If neither the 15-year payment nor the 30-year interest cost feels right, the 20-year is worth requesting a quote on.
What this calculator computes — and what it does not
This calculator models fixed-rate, fully amortizing loans using the standard amortization formula. A number of real-world factors are outside its scope.
- 1.Results are estimates, not guarantees. Actual loan costs depend on the exact terms in your loan agreement, any fees charged at origination, how the lender applies payments, and whether you make every payment exactly on schedule. This calculator assumes all payments are made on time with no changes.
- 2.Interest rates are user-supplied, not live market data. This tool does not connect to any rate feed. The rate you enter should come from a lender quote or your loan agreement. Current rates vary by lender, credit score, loan type, and market conditions — this calculator cannot provide those figures.
- 3.Property taxes, insurance, and PMI are excluded unless toggled on. The payment computed here is principal and interest only. For a mortgage, your total monthly obligation includes property taxes, homeowners insurance, and PMI (if your down payment is under 20%) — collected in escrow by most lenders. These can add $200–$800 or more per month to the P&I payment shown.
- 4.APR vs. interest rate. This calculator uses the stated interest rate for payment math. APR (Annual Percentage Rate) is always higher than the interest rate because it spreads lender fees over the loan term. APR is the correct metric for comparing loan costs across lenders; the stated rate is the correct input for computing the payment schedule.
- 5.Variable-rate loans cannot be accurately projected. This calculator models fixed-rate amortization only. For adjustable-rate mortgages (ARMs), tracker mortgages, or variable-rate personal loans, the payment changes when the rate resets — the full-term projection would require assumptions about future rates that cannot be known in advance.
This calculator is for educational and planning purposes only. It does not constitute financial, mortgage, or legal advice.