The Choices
Which answer is correct?
Think flexibility, not interest rate.
- A Lower required payment
- B Lower interest rate
- C No closing costs ever
- D No need for an emergency fund
Answer: A · Lower required payment
The main advantage is flexibility. You can make the extra payment when cash is available, but fall back to the lower required 30-year payment when needed.
The money lesson
The main advantage is the lower required payment. A true 15-year loan may have a lower rate, but it also locks in a higher required monthly payment.
This puzzle is designed to make one financial rule easier to remember. Use it as a starting point, then run your own numbers before making a real-world decision.