Property
You've been watching the rate number every Thursday, and the 30-year keeps sitting above 7%. So you glance at the 15-year, see 6.68%, and wonder whether the shorter loan is the smart way around a rate that won't come down. It might be, but the monthly payment is where that idea usually dies. Here's the exact trade at this week's rates.
Freddie Mac's survey for the week ending October 22, 2026 put the 30-year fixed at 7.32% and the 15-year at 6.68% (Freddie Mac PMMS, October 22, 2026). A year earlier, the two rates were 6.19% and 5.44%.
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The payment gap: $582 a month on $300,000
On a $300,000 loan, the 30-year at 7.32% costs $2,061 a month in principal and interest. The 15-year at 6.68% costs $2,643. That's $582 more every month, or about $6,990 more a year, for the same house.
A year ago the same loan cost $1,835 on a 30-year at 6.19% and $2,442 on a 15-year at 5.44%, a $606 gap. The 30-year payment has risen $225 a month in 12 months and the 15-year has risen $201. The spread between the two rates has narrowed from 0.75 points to 0.64, which is why the shorter loan looks slightly cheaper to choose than it did a year ago.
If you're comparing the two loans, that means the extra $582 buys you a smaller discount than last year, and it still has to fit inside your budget every month for 15 years.
What the $582 buys: $266,000 less interest
Over its full term the 30-year loan costs $441,885 in interest. The 15-year costs $175,758. The shorter loan saves $266,127, and you own the house free and clear 15 years sooner.
| $300,000 loan | 30-year at 7.32% | 15-year at 6.68% |
|---|---|---|
| Monthly principal and interest | $2,061 | $2,643 |
| Total interest over the loan | $441,885 | $175,758 |
| Income needed at the 28% front-end rule (principal and interest only) | about $88,300 | about $113,300 |
| Payment a year ago | $1,835 (6.19%) | $2,442 (5.44%) |
The income line is where most buyers find the answer. The standard 28% front-end rule (the share of gross income a lender likes housing costs to stay under) means the 15-year needs about $25,000 more in annual income just for principal and interest, before tax and insurance. If you can't clear that comfortably, the shorter loan is a savings plan you can't afford, however good the interest math looks.
The middle path: a 30-year you pay like a 15
There's a way to get most of the savings without the lock-in. Take the 30-year at 7.32% and pay the $2,643 anyway. The loan is gone in about 16.2 years and total interest comes to about $212,000. That's $36,000 more interest than the real 15-year loan, which is the price of flexibility.
What that price buys is the ability to drop back to $2,061 in a month when a job changes or a roof fails, with no refinance and no new closing costs. Smaller extra payments work the same way: adding $300 a month retires the 30-year in about 20.4 years and cuts interest to about $279,000.
For you, that means the second loan is a real option only if the payment is a commitment you can keep, and the first loan is the safer one if your income isn't locked in.
When refinancing into a 15-year makes sense
Refinancing is a separate decision with its own cost. If you hold a mortgage in the 3% to 5% range, a refinance to a 6.68% 15-year would raise your rate, and the refi break-even math shows why that rarely pays. The case that does work is a recent buyer carrying a 7.5% or higher 30-year who can afford the higher payment: dropping to 6.68% on a 15-year cuts the rate by a full point or more, though closing costs of roughly 2% to 3% of the loan take years to earn back.
If you're in the first group, the answer today is to leave your loan alone and send any extra cash to principal instead. If you're in the second, wait for the number before paying closing costs twice.
A worked example: the first 12 months of each loan
Take the same $300,000 loan and follow the first year. On the 30-year at 7.32%, you pay $24,730 over 12 months and about $21,900 of that is interest, so principal drops by roughly $2,860. On the 15-year at 6.68%, you pay $31,717 and about $19,700 is interest, so principal drops by roughly $12,000. In year one, the shorter loan builds about four times as much equity from payments alone.
That's the real reason the 15-year feels so different once you own it. The extra $582 a month isn't a cost in the way a fee is a cost: the extra $6,990 a year, plus about $2,200 less interest, comes back as roughly $9,200 more equity in year one that you can borrow against or sell into. The catch is that equity is only useful if you can reach it, and a house that's hard to sell or a HELOC that's expensive at today's rates makes that equity less liquid than cash in a savings account.
So if you're sitting on a stable salary and an emergency fund covering six months of the larger payment, the 15-year builds wealth faster. If either of those is missing, the extra equity is locked in a house instead of working for you.
Who the 15-year actually fits
It fits a narrow group: buyers with 20% or more down, household income at or above roughly $113,000 for a $300,000 loan, and no other debt competing for the same monthly cash. It also fits buyers within about 15 years of retirement who want the mortgage gone before their paychecks stop.
It fits poorly for anyone with less than 20% down, because the larger payment arrives on top of private mortgage insurance, and for anyone who expects to move in five to seven years, because the interest savings only show up if you hold the loan. Most people who run these numbers end up with the 30-year and a standing instruction to add extra principal when the month allows.
If you fall in the poor-fit group, that means this week's 6.68% is a number to watch, not a loan to chase.
What to do with this week's rates
The math points toward a 30-year loan with a 15-year payment habit for most people. The full 15-year saves $36,000 more interest, but it cuts your margin for error by $582 a month while the Fed's next move is still uncertain. Frankly, if you're buying with less than 20% down, the closing costs explainer and the down payment myth article matter more to your first-year cash position than the loan term does.
Freddie Mac publishes new rates every Thursday, so check the number on October 29 before you lock anything. A 0.10-point move changes a $300,000 payment by only about $20 a month, which means you should decide on the loan term first and treat the weekly rate as a rounding error.
Frequently asked questions
What are today's 15-year and 30-year mortgage rates? Freddie Mac's survey for the week ending October 22, 2026 put the 30-year fixed at 7.32% and the 15-year fixed at 6.68%. New rates publish every Thursday.
How much more is a 15-year mortgage payment than a 30-year? On a $300,000 loan, the 15-year at 6.68% costs about $2,643 a month in principal and interest, compared with $2,061 for the 30-year at 7.32%. That's a $582 monthly difference.
How much interest does a 15-year mortgage save? On $300,000, total interest is about $175,758 on the 15-year and $441,885 on the 30-year, a saving of about $266,000 over the full term.
Can I pay off a 30-year mortgage like a 15-year? Yes, if your loan has no prepayment penalty. Paying $2,643 a month on a 30-year at 7.32% pays off $300,000 in about 16.2 years with about $212,000 in interest, and you can drop back to the required payment at any time.