When we did our (hopefully last, ha!) refi, I got quotes for 15y vs 30y. The interest rate spread at that time was about half a percent. I compared the amount of time till payoff and total interest paid for the 15 year vs the 30 year making a monthly overpayment to equal the 15 year monthly payment. The 30 year loan ended up taking about 15.5 years to pay off, and with a bit more total interest paid over the life of the loan.
However, we were looking to make a more significant monthly overpayment, which closes this gap considerably. In the end, we went with the 30y. We will pay slightly more in overall interest, but liked the flexibility of being able to drop back to the minimum 30y payment if a change in income required it. And I suppose if interest rates rise above our loan rate, there’s a compelling case to be made for dropping back to the minimum payment in that scenario too.
