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A 15 Year Loan May Not Be Such a Good Idea.
It interests me how many Realtors are suggesting new home buyers pick slightly lower interest rate home loans rather than those that those with 30-year amortization periods.
The rational is that the interest rate for 15-year loans is slightly less than that for those of longer periods.
And that the buyer will pay off his home up to twice as fast.
They claim the same is true for refinancing existing loans. 
Not only will the rate for the new loan be substantially lower than the old one, but it also gives the homeowners the opportunity to pick a loan that amortizes faster.
From a strictly financial-analytical sense, the logic is lousy. 
When mortgage interest rates are very cheap, as they are today, and the value of homes is seriously diminished and with no recovery of sizable consequence in the near future, there is a much better avenue.
Go with the 30-year loan and invest the difference in the payments each month into an appreciating asset, like a mutual fund.
Here’s an example:
          $200,000 @ 4% for 30 years = $   955 per month          $200,000 @ 4% for 14 years = $1,479 per month
The average home buyer stays in ... more

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