Question: one usually has the option of paying off the longer-term > loan faster and thus, saving on interest payments

Answer: While you are paying extra payments on a 30-year, you are still paying a much bigger chunk of your monthly payment to interest.

I had a 15-year on my former cottage. The monthly payment difference between a 15-year and a 30-year was $100/month more for the shorter loan. The percentage going to interest was signficantly different. You can make extra payments to principal, but you’re still paying a lot more each month in interest and a lot less to principal in your regular payment

I just refinanced my new house from a 30 year to a 25 year (and from 7.3% to 5.375%). The interest rate would have been the same, 5.37%, for a 30-year, 25-year, or 20-year. I couldn’t afford a shorter term than 25 years, but each shorter term had a different proportion of payment going to principal each month.

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