What is a 15-year fixed mortgage rate?
A 15-Year Fixed Mortgage rate is the interest rate you receive on a fixed-rate mortgage that lasts for 15 years instead of the standard 30 years. It may be a good option for many homebuyers because it locks in the same interest rate for the entire term of the loan. One of the big advantages of 15-year, fixed-rate mortgages is that they typically offer a lower interest rate compared to a 30-year Fixed Mortgage. This can result in significant savings on the total interest paid over the life of the loan.
Additionally, buyers pay off their mortgages in half the time as those with 30-year mortgages.
While the lower interest rate is a major advantage, it's important to consider the shorter repayment period means that the monthly payments will be higher than those of a 30-year mortgage. This is because the loan amount is amortized over a shorter period, so you have less time to pay it off. However, this can be a beneficial trade-off for those who can afford the higher monthly payments. It allows homeowners to build equity faster and pay off their mortgages sooner.
Choosing a 15-year Fixed Mortgage can be a smart financial strategy for those looking to save on interest and who have the financial means to handle the higher monthly payments. It's an especially appealing option for those planning to stay in their home long-term and who wish to own their property outright more quickly. This mortgage type not only helps in faster accumulation of home equity, but may also provide the peace of mind that comes with consistent payments and protection against potential rises in interest rates.
Average 15-year fixed mortgage rate
The average 15-year fixed mortgage rate for 2025 was around 5.7% and it decreased as the year progressed, ending at 5.4%.
15-year fixed mortgage rate history
In 1991, when Freddie Mac started tracking the 15-year fixed rate, it was under 8%. Since then, it has fluctuated, dropping to its lowest point in 2020, staying around under 3% for most of the year.
Mortgage rates change over time because of economic and political changes that affect the market and public policies. Your personal rate will be affected both by these global factors as well as personal factors like your credit profile.
Qualifying for a 15-Year Fixed-Rate mortgage
Qualifying for a 15-Year Fixed-Rate mortgage generally depends on which type of mortgage you are trying to get. For instance, for a Conventional loan, lenders usually require a minimum credit score of 620*, a debt-to-income ratio of 43%, and a down payment of 3%-20%. However, if you want to use a government insured loan, the requirements will be different. An FHA loan, for example, has a 3.5% down payment requirement and has a minimum credit score requirement of 500.
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