20-year vs. 30-year mortgage
The primary difference between a 20-year and 30-year mortgage lies in the balance between the monthly payment size and the total interest paid. A 30-year mortgage offers lower payments but significantly more interest paid over time, while a 20-year mortgage requires less interest paid over time but higher monthly payments.
The table below compares 20-year and 30-year mortgages based on a $400,000 home with a 20% down payment ($80,000) and estimated average interest rates:
| Term length | Loan amount | Interest rate | Monthly payment | Total interest paid | Total cost over life of loan |
|---|---|---|---|---|---|
| 20-year | $320,000 | 5.70% | $2,237.54 | $217,010.26 | $537,010.26 |
| 30-year | $320,000 | 6.50% | $2,022.62 | $408,142.36 | $728,142.36 |
20-year mortgage
A 20-year mortgage is a fixed-rate home loan with a repayment term of 20 years. It typically comes with a lower interest rate compared with a 30-year mortgage and helps borrowers build equity faster. However, monthly payments are higher due to the shorter term.
30-year mortgage
A 30-year mortgage is a fixed-rate home loan with a 30-year repayment term. It usually has a higher interest rate than shorter-term loans, but the extended term means lower monthly payments. This makes homeownership more accessible for those who need to keep monthly costs down.
20-year mortgage pros and cons
The main benefit of choosing a 20-year mortgage is paying less interest over the loan period. Compare the pros and cons of 20-year mortgages:
Pros
- Shorter repayment period
- Build equity faster
- Lower interest rate
Cons
- Higher monthly payments
- Reduced home affordability
- Harder to find lenders with this term length
30-year mortgage pros and cons
Most homebuyers choose 30-year mortgages since they come with lower monthly payments. However, there are some downsides. Compare the pros and cons of 30-year mortgages:
Pros
- Lower monthly payments
- Most widely available loan term
- More home affordability
Cons
- More interest paid over time
- Longer repayment period
- Build equity slower
Current mortgage rate trends
The average 30-year fixed mortgage rate is 6.48% as of June 4, 2026, according to the Federal Reserve Bank of St. Louis. Thirty-year mortgage rates have generally hovered below 7% since June 6, 2024.
Twenty-year mortgage rates tend to be lower than 30-year mortgage rates.
While the Federal Reserve Bank of St. Louis doesn’t track average 20-year mortgage rates, the average 15-year mortgage rate is 5.79% as of June 4, 2026. Typical 20-year mortgage rates should generally hover between the average 30-year and 15-year rates.
Generally, economic indicators such as wage growth, employment levels and inflation continue to influence rate volatility. For prospective homebuyers, this means it’s especially important to shop around, compare mortgage lenders and evaluate how different mortgage terms can impact total borrowing costs. Locking in a rate when conditions are favorable can help manage long-term expenses.
Current mortgage rates
Rates are effective 07/22/2026 and are subject to change without notice. APR shown is provided by a partner of ConsumerAffairs.
| Product | APR | |
|---|---|---|
| 7.23%-0.01% | Get Rates | |
The APR shown of 7.230% is available for a 30-year fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
| 7.24%0.47% | Get Rates | |
The APR shown of 7.240% is available for a 20-year fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
| 8.247%0.11% | Get Rates | |
The APR shown of 8.247% is available for a 30-year FHA fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
| 6.769%0.0% | Get Rates | |
The APR shown of 6.769% is available for a 20-year FHA fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
| 6.271%0.0% | Get Rates | |
The APR shown of 6.271% is available for a 30-year VA fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
| 6.365%0.0% | Get Rates | |
The APR shown of 6.365% is available for a 20-year VA fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
Current refinance rates
| Product | APR | |
|---|---|---|
| 7.475%0.11% | Get Rates | |
The APR shown of 7.475% is available for a 30-year fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
| 7.431%0.0% | Get Rates | |
The APR shown of 7.431% is available for a 20-year fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
| 8.236%0.38% | Get Rates | |
The APR shown of 8.236% is available for a 30-year FHA fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
| 6.642%0.0% | Get Rates | |
The APR shown of 6.642% is available for a 20-year FHA fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
| 6.387%-0.02% | Get Rates | |
The APR shown of 6.387% is available for a 30-year VA fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
| 6.582%0.0% | Get Rates | |
The APR shown of 6.582% is available for a 20-year VA fixed rate loan in the amount of $200,000 for consumers with loan-to-value of at least 80%. | ||
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FAQ
Can I switch from a 30-year mortgage to a 20-year mortgage later?
Yes, you can refinance your loan to a shorter term once your financial situation improves. This could reduce your total interest paid, but be sure to consider closing costs and current interest rates, which could reduce your savings.
What are the differences between a 15-year and 20-year mortgage?
A 15-year mortgage typically comes with an even lower interest rate and helps you build equity in your home faster. However, the monthly payments on a 15-year mortgage will be higher than on a 20-year loan. Overall, 15-year mortgages (or even 10-year mortgages) are only worth considering if you can afford higher monthly payments.
» RELATED: 15-year vs. 30-year mortgage
Do I need a higher credit score to qualify for a 20-year mortgage?
You don’t necessarily need a higher credit score to qualify for a 20-year mortgage, though lenders typically offer better rates on shorter-term loans to borrowers with strong credit profiles.
Bottom line: Should you get a 20-year or 30-year mortgage?
If you want to minimize your monthly payments and have more cash on hand to invest elsewhere, a 30-year mortgage may be your best choice. In comparison, a 20-year mortgage may be a better choice if you can comfortably afford higher monthly payments. You’ll pay less money in interest and gain equity in your home more quickly. Ultimately, it comes down to your monthly budget and financial goals as a homeowner.
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
- Federal Reserve Bank of St. Louis, “30-Year Fixed Rate Mortgage Average in the United States.” Accessed June 9, 2026.
- Federal Reserve Bank of St. Louis, “15-Year Fixed Rate Mortgage Average in the United States.” Accessed June 9, 2026.
- Federal Reserve Bank of St. Louis, “Median Sales Price of Houses Sold for the United States.” Accessed June 9, 2026.
