The $3,146 Trade-off

A 15-year mortgage has higher monthly payments but dramatically lower total cost. On that same $350,000 loan at 7%, the 15-year payment is $3,146 (vs $2,329 for 30-year).

But total interest paid? About $216,262 compared to $488,281. You save over $272,000 — and you typically get a lower rate on 15-year loans too.

The trade-off is flexibility. That extra $817/month is locked up in your house. Some people prefer a 30-year mortgage but make extra payments when they can — you get the lower required payment as a safety net, with the option to pay it off faster.