Question

value: 3
use your worksheet to answer the following question.
what is a disadvantage of getting a 15 - year mortgage instead of a 30 - year mortgage?
a. you will pay more for your monthly payment.
b. you will have a lower interest rate.
c. you will pay the monthly payment for a shorter amount of time.
d. you will pay more over the life of the loan.

Explanation:

• Option b is an advantage of a 15-year mortgage, as shorter terms often have lower rates.
• Option c is also an advantage, since the repayment period is shorter.
• Option d is incorrect: 15-year mortgages have less total interest, so you pay less over the loan's life.
• Option a is a disadvantage: the principal and interest are spread over half the time, so monthly payments are significantly higher than a 30-year mortgage.

Answer:

a. You will pay more for your monthly payment.