On a $240,000 loan, a 15-year mortgage at 5.5% costs about $118,000 in total interest, while a 30-year at 6.5% costs about $306,000. That's a savings of roughly $188,000 over the life of the loan. You also build equity much faster, owning your home free and clear in half the time.

Yes, 15-year fixed mortgages typically carry rates 0.5% to 1% lower than 30-year mortgages. Lenders offer better rates because the shorter term reduces their risk exposure. This rate advantage amplifies the interest savings you already get from the shorter repayment period.

A 15-year mortgage works best for buyers with stable, higher incomes who can comfortably afford the larger monthly payment without sacrificing emergency savings or retirement contributions. It's also popular among refinancers who've already paid down some of their 30-year loan and want to accelerate their payoff timeline.