I'm wondering if someone can offer me a bit of advice on a mortgage question I have.
Currently I'm on a variable rate mortgage thats amortized over 25 years. I'm permitted to pay off up to 15% of the principal annually without penalty. I have my current payment set to be about 2.75% above my actual rate so I'm basically paying around an extra $420 a month more than what I'm required to. As it works out the current payment has me on schedule to pay the mortgage off in 15 years as opposed to 25.
This got me thinking would it be worth looking into switching to a 15 year mortgage, or would the diffence end up being negligible in the end? Right now what I have is flexible as I can move my payment up and down without any problem. Also the lower obligated payment might be a usefull thing one day in the future if I decide to borrow myself even futher into debt.
I've tried calculations using mortgage calculators that the banks have on their website and I don't think it's really come up any different. So the question is it any different to borrow the money over the shorter term as opposed to borrowing it over the 25 year term and putting the extra straight onto the principal? Just wondering if it's something I should maybe consider?