(HawaiiNewsNow) - There is a fascinating new trend in home mortgages. For 4 generations the default home loan in America has been the 30-year fixed-rate mortgage. Fixed-rate mortgages still account for 95% of all home loans. Now the Freddie Mac quarterly product transition report says, the 15-year note is suddenly "hot".
In the second quarter, of all the Americans who refinanced their 30-year mortgages, 37% chose 15 or 20 year notes.
The interest rate on a 15-year fixed mortgage was eight tenths of a percent lower than a 30-year note. Even at a much lower rate, your monthly payment is much larger for a 15-year mortgage, although you build equity faster. A 15 year mortgage looks good to someone who has secure income but doesn't feel comfortable putting money into other investments.