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Is the 40-year mortgage a joke?

By Marcie Geffner - Bankrate.com

It's true: A 40-year mortgage can make your monthly house payment more affordable. But mortgage brokers say such long-term loans generally aren't the best choice for most borrowers because they typically come with a higher interest rate and cost more in interest over the lifetime of the loan.

This trade-off between a lower payment and higher costs is so unattractive that Jeff Lazerson, president of online mortgage broker MortgageGrader.com, says the 40-year mortgage is "a joke."

"Amortizing a loan over 10 more years does very little to decrease the payment, and the industry has historically priced 40-year loans more expensively than 30-year loans, so the benefit that the consumer perceives they should get, they don't get," he says.

Read on:
http://www.bankrate.com/finance/mortgages/is-the-40-year-mortgage-a-joke-1.aspx

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