Basics, Pros and Cons of 30-Year Mortgages

Recently in this space, we discussed the pros and cons of a 15-year home mortgage. This is the shortest time period available for most mortgages, and has its own set of qualities that might or might not work for your situation.

Today, we’ll discuss the 30-year mortgage – the longest option typically available, and part of what most consider conventional mortgages. While these loans can be both fixed-rate and adjustable-rate mortgages, we’ll focus solely on the former today – the 30-year fixed rate mortgage is easily the most popular format chosen. Let’s look at some of the pros and cons of a 30-year fixed rate mortgage.


Here are some of the positives associated with a 30-year term:

  • Lower payments: A 30-year term stretches out monthly payments over the longest period possible, lowering the total amount you pay each month.
  • Flexibility: You can pay off the loan faster by adding payments or making extras, but you can always fall back to the smaller payment if you have to. This kind of flexibility can be tougher to come by for shorter loan periods, where more interest has to be paid up front.
  • Predictability: The fixed-rate part of the term is so popular because it ensures your payments won’t change regardless of the economy. Adjustable-rate mortgages, on the other hand, are prone to fluctuations based on the market after a certain point in the loan.
  • Better homes: Lower monthly payments often mean you can qualify for a more expensive home.
  • Tax deductions: Tax laws allow home buyers to deduct mortgage interest from taxes – you pay more such interest on a 30-year term.
  • Easier to qualify: Smaller payments make more people eligible.


There are a few potential drawbacks to 30-year loans:

  • Higher rates: Mortgage rates will be higher, as lenders take a risk that’s spread over a longer period of time and must compensate.
  • Total interest: This means that over a 30-year loan period, you’ll pay much more total interest than a shorter term.
  • Slow equity: You can build equity in a home with a 30-year loan, but this happens slower than with a shorter term.
  • Overborrowing: Qualifying for bigger mortgages tempts some people into getting a bigger home than they need, and one they might struggle to repay down the line.

To learn more about the pros and cons of a 30-year mortgage, or for more on any of our services, speak to the pros at American Loans.