Looking to build equity faster? Use this 15 year fixed rate mortgage calculator to estimate your monthly principal and interest payments and see how much interest you can save by choosing a shorter loan term.
15 Year Fixed Rate Mortgage Calculator
15 Year Fixed Rate Mortgage Calculator Formula
The calculation uses the standard fixed-rate mortgage amortization formula with the term (n) set to 180 months (15 years):
Variables
- M: Monthly Payment (Principal & Interest).
- P: Loan Principal (Home Price – Down Payment).
- i: Monthly Interest Rate (Annual Rate / 12).
- n: Total Number of Payments (15 years × 12 = 180).
Related Calculators
- 30 Year Fixed Rate Calculator
- 15 vs 30 Year Comparison
- Mortgage Payoff Calculator
- Refinance Savings Calculator
What is 15 Year Fixed Rate Mortgage Calculator?
A 15 year fixed rate mortgage calculator helps homebuyers determine the monthly cost of a shorter-term loan. Compared to the standard 30-year mortgage, a 15-year term requires higher monthly payments but comes with significant benefits: you build equity much faster, and you typically secure a lower interest rate, resulting in massive interest savings over the life of the loan.
This tool is ideal for buyers who have strong cash flow and want to minimize their total debt cost or become mortgage-free sooner.
How to Calculate 15 Year Fixed Rate Mortgage (Example)
Let’s look at a scenario for a $300,000 loan at 5.5% interest:
- Loan Amount (P): $300,000.
- Interest Rate (r): 5.5%. Monthly Rate (i) = 0.055 / 12 ≈ 0.004583.
- Term (n): 15 years = 180 months.
- Calculation:
- Numerator: 0.004583 × (1.004583)^180 ≈ 0.0104.
- Denominator: (1.004583)^180 – 1 ≈ 1.276.
- Monthly Payment: ~$2,451.
- Total Interest: ($2,451 × 180) – $300,000 = $141,180. (A 30-year loan at 6.5% would cost over $380,000 in interest!)
Frequently Asked Questions (FAQ)
Yes. Lenders take on less risk with a shorter term, so they typically offer interest rates that are 0.25% to 0.75% lower than 30-year fixed rates.
Because the monthly payments are higher, your Debt-to-Income (DTI) ratio will be higher. You generally need a higher income or lower existing debt to qualify compared to a 30-year loan.
Yes. You can take a 30-year loan for flexibility and make extra principal payments to pay it off in 15 years. However, you might have a slightly higher interest rate than if you had chosen a 15-year term initially.
This specific calculation covers Principal and Interest only. Property taxes and insurance are variable costs that should be added on top to get your full monthly housing expense.