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Pros and Cons of a 30-Year Fixed-Rate Mortgage

A longer repayment period qualifies buyers for lower payments or a pricier home. But the rate will be higher and you'll pay more interest over the life of the loan.

Bella Angelos
Chris Jennings
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Thinking about getting a 30-year fixed-rate mortgage? Good idea. This granddaddy of all mortgages is the choice of nearly nine out of every 10 home buyers.
It’s no mystery why 30-year fixed-rate mortgages are so popular. The long repayment period keeps monthly payments lower, and the fixed rate means homeowners can count on consistent payments no matter what — although taxes and insurance premiums may change.
Here’s a quick look at the benefits — and some drawbacks — of this popular mortgage.
» MORE: Calculate how much home you can afford with a 30-year mortgage

What is a 30-year fixed-rate mortgage?

A 30-year mortgage is a home loan that will be paid off completely in 30 years if you make every payment as scheduled.
Most 30-year mortgages have a fixed rate, meaning that the interest rate and the payments stay the same for as long as you keep the mortgage.

Advantages of a 30-year mortgage

Lower payment

A 30-year term allows for a more affordable monthly payment by stretching out the repayment of the loan over a long period.

Flexibility

You can pay off the loan faster by adding to your monthly payment or making extra payments, which reduces interest over time, while still having the flexibility to fall back on the smaller payment as needed.

Predictability

It’s nice to count on your mortgage payment staying the same, no matter how stormy the economy gets or how high the interest rates climb, making long-term financial planning easier.

More house for the mortgage

Lower payments mean you could qualify for a more expensive home.

Bigger tax deduction

Current tax laws let home buyers deduct mortgage interest from their taxes. In the early years of a loan, most of your mortgage payments go toward paying off interest, making for a meaty tax deduction.
» MORE: Review the best 30-year fixed mortgage lenders

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Disadvantages of a 30-year fixed-rate mortgage

Higher rates

Lenders charge higher interest rates on longer loans because the risk of not getting repaid increases over time.

More interest paid

Even though monthly payments are lower on a 30-year loan, you end up paying significantly more in interest over the life of the mortgage.

Slower equity growth

It takes longer to build an equity share in a home because a larger portion of your early payments goes toward interest rather than principal.

Danger of overborrowing

Qualifying for a bigger mortgage can tempt some people to get a bigger, better home that's harder to afford. Remember to leave a cushion for life’s inevitable surprises.

Higher upkeep costs

If you go for a pricier home, you’ll face steeper costs for property tax, upkeep and maybe even utility bills. A good rule of thumb is to budget 1% to 2% of the purchase price for upkeep.
» MORE: Adjustable-rate vs. fixed-rate mortgages

How to accelerate your savings

With a little planning, you can combine the safety of a 30-year mortgage with one of the biggest advantages of a shorter mortgage: a faster path to fully owning your home. How? By paying off the loan sooner.

Make 15-year mortgage payments on a 30-year loan

The idea is simple. You take out a 30-year mortgage, but you make payments as if it were a shorter-term loan.
To get started, figure out the monthly payment you could afford on a 15-year mortgage. Then, take out a 30-year mortgage, but pay at that higher 15-year level whenever possible.
This gives you a lower required payment as a safety net while still letting you pay off your mortgage faster and save on interest. You can adjust extra payments if your budget changes, keeping flexibility without losing progress toward full homeownership.
🤓 Nerdy Tip
If you want to try it, ask your lender for an amortization schedule. This shows how much you’d need to pay each month to own your home completely in 15 years, 20 years or another timeline of your choosing. You can also use a 15-year vs. 30-year mortgage calculator to compare costs, monthly payments, and payoff timelines, helping you decide which loan term is right for you.

Know the trade-offs

This approach isn’t identical to getting a shorter mortgage because the interest rate on a 30-year mortgage will be slightly higher. For example, if a 15-year fixed mortgage has a rate of 5.50%, a 30-year loan might be around 6.11%. Still, by paying extra each month, you can pay off the mortgage faster and save on interest over time.
» MORE: Calculate the impact of biweekly payments

Mortgage loans from our partners

NBKC

on NBKC

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4.5

NerdWallet rating
Min. credit score

620

Min. down payment

3%

New American Funding

on New American Funding

New American Funding

4.0

NerdWallet rating
Min. credit score

N/A

Min. down payment

0%

GO Mortgage

on GO Mortgage

GO Mortgage

4.0

NerdWallet rating
Min. credit score

620

Min. down payment

3%

COMPARE MORE LENDERS
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