30-YEAR FIXED LOAN

This is a long-term loan in which principal and interest are amortized over 30 years; interest rate remains unchanged for life of the loan. This loan provides considerable tax benefits, especially in the early years. It comes with lower monthly payments due to the amortization time. Another plus is that the interest rate never rises, regardless of inflation. However, the 30-year term provides for slow equity build-up than a 15-year loan. Also, the loan has higher costs of loan pay back due to length of mortgage. Still, this is the most common mortgage in the U.S. It is a particularly good investment when rates are low.