The 15-year loan, long considered a fringe character in the mortgage scene, is riding a wave of popularity.
Thanks to low interest rates, many borrowers are opting for the deal that allows them to pay off their mortgages in half as much time as the traditional 30-year mortgage.
Nearly 16% of the fixed-rate mortgages that lenders sold to Freddie MacFMCC -1.02% during the third quarter were 15-year loans, up from almost 10% a year prior, according to the agency’s data. (That data doesn’t include refinancings.) And 15-year mortgages accounted for nearly a third of refinanced loans during the first seven months of this year, according to the latest data by CoreLogic CLGX -3.60% . The figure has been climbing since 2007, when they made up just 8.5% of refinancings.
The 30-year mortgage became the standard in lending because its lower monthly payments made real estate affordable to more Americans. While…
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