Does shortening the life of your home loan sound ideal? For some home buyers, choosing a 15-year mortgage provides the opportunity to get out of debt quicker and see a faster return on their investment. But this type of mortgage isn't for everyone. Take a look at some of the top questions that can help you to figure out if a 15- or 30-year mortgage is right for you.

Do You Have a Steady Income?

More specifically, do you have a steady income that allows you to pay a higher amount monthly? It's no secret that a 15-year mortgage lets you pay off your mortgage in half as much time as a 30-year one. But the quick payoff comes at a cost. If your current and future financial states don't allow you to make potentially hefty payments, it's better to stick with the lower monthly amount of a 30-year mortgage.

Failure to pay your mortgage monthly can result in stiff penalties, fees, and a negative credit rating. Even though you may have a high salary right now, consider what your earning potential is over the next decade and a half. If you're thinking about switching professions, you or your spouse may decide to become a stay at home parent, or you're a freelancer (with an unpredictable income), a 15-year loan may not be for you.

Do You Have a High Debt Ratio?

Your own comfort level isn't the only deciding factor when it comes to income and mortgage terms. The lender may not see you as a desirable candidate for a shorter loan life based on the amount of debt that you have versus your income stream. If you carry high credit card balances, have unpaid student loans, or have a hefty auto loan, you may only qualify for a 30-year loan.

Do You Have Major Life Changes Coming Up?

A major life change can significantly impact your ability to repay a loan. While not every change can, or should, factor into your decision, consider these possibilities:

Having a child. The U.S. Department of Agriculture (USDA) estimates that the cost of raising a child is $233,610. That's money you won't have to put towards your mortgage. Whether you're having your first child or fifth, the impact of the related costs may make handling a 30-year mortgage easier.

Buying other property. Are you planning to invest in a vacation property? If adding another mortgage to your debt is on the horizon, you may not have the extra cash to pay a 15-year loan.

Leaving a job. Whether you plan on retiring or you're leaving your job for another reason, dramatically decreasing your family income may make paying a shorter-term loan challenging.

Along with these changes, anything that impacts your ability to pay a loan monthly should factor into your mortgage decision.

Do You Want a Lower Interest Rate?

In general, 15-year mortgages comes with somewhat lower interest rates. These shorter-term loans are less of a risk and less costly for lenders. Along with getting their money back sooner, lenders are more likely to give shorter mortgages to home buyers with better credit. This adds to the lower interest rate (borrowers with better credit scores tend to get lower interest rate offers).

If you can secure, and pay for, a 15-year mortgage, it may end up costing you less in the long run. Even though you'll have to pay interest on both types of loans, a difference of one percent (or even a fraction of a percent) can add up over time.

Do you need a home loan? Contact  Loan Fox Inc. for more information.