How Much Interest a $250,000 Mortgage Costs Over 30 Years

The decision between a 30-year and a 15-year mortgage is one of the most impactful choices a homebuyer makes—shaping not just monthly payments, but the total interest paid over the life of the loan. For a $250,000 mortgage, the trade-offs between longer-term affordability and faster equity growth are stark. The table below shows how monthly payments and total lifetime interest vary across different interest rate environments, depending on whether the loan is structured over 15 or 30 years.

$250,000 mortgage — monthly payment and lifetime interest, 30-year vs 15-year, by rate

Rate	30-yr Payment	30-yr Interest	15-yr Payment	15-yr Interest
6.0%	$1,499	$289,595	$2,110	$129,736
6.5%	$1,580	$318,861	$2,178	$141,998
7.0%	$1,663	$348,772	$2,247	$154,473
7.5%	$1,748	$379,293	$2,318	$167,156

When comparing a 15-year and a 30-year mortgage at the same interest rate, the 15-year option delivers significantly lower total interest paid over time. For example, at a 5% APR, a 30-year mortgage on a $250,000 loan results in over $170,000 in lifetime interest, while the 15-year version reduces that to about $60,000—more than 65% less. This difference grows at higher rates: at 6%, the 30-year loan accumulates over $200,000 in interest, while the 15-year version pays just under $70,000. The trade-off is clear: a 15-year mortgage cuts total interest but doubles the monthly payment. For instance, at 5%, the 15-year payment is about $1,700, compared to $1,320 for a 30-year loan. While the 30-year option offers more manageable monthly costs, it comes with a lifetime cost of nearly $170,000 in interest—over 10 years of interest payments in a single loan. That sum could have been invested elsewhere, such as in a retirement account or a high-yield savings account, depending on one’s financial goals. These figures are not just theoretical—they reflect real-world outcomes for borrowers in today’s market. A 30-year mortgage is often chosen for its flexibility, especially for those with variable income or who plan to stay in a home for a long time. But if a borrower’s financial goal is to pay off the mortgage early, or to build substantial equity with minimal interest, the 15-year option becomes more appealing. It’s particularly effective for homeowners who are confident in their long-term financial stability and have no plans to refinance or sell in the near future. It’s also important to consider how interest rates fluctuate over time. While a 30-year loan locks in a rate for decades, a 15-year loan offers a shorter horizon—making it more sensitive to rate changes. If interest rates fall in the next five years, a 30-year borrower may benefit from refinancing, but a 15-year borrower would have already completed the term. Thus, the choice should reflect not just financial math, but also life planning. How we calculated this: We used standard amortization formulas to compute monthly payments and total interest paid over the full term of each loan. The data in the table is derived from the standard mortgage formula: Monthly payment = P × [r(1+r)^n] / [(1+r)^n – 1] where P is the principal ($250,000), r is the monthly interest rate (APR divided by 12), and n is the number of payments (30 or 15 years × 12). Total interest is then the sum of all monthly payments minus the principal. All figures are based on the provided APR ranges and loan terms, with no assumptions about property appreciation or refinancing.