2024 Mortgage Term Length: Choosing Between 25-Year and 30-Year Mortgages

May 28, 2024 | Mortgage

Choosing Between 25-Year and 30-Year Mortgages in Windsor, ON


When purchasing a home, one of the crucial decisions you’ll face is selecting the right mortgage term length. With rising interest rates, the choice between a 25-year and a 30-year mortgage can significantly impact your financial future. Here’s what you need to know to make an informed decision in 2024.

1. Monthly Payments vs. Total Interest Paid

Choosing a longer mortgage term, such as a 30-year mortgage amortization, typically results in lower monthly payments compared to a 25-year mortgage. This can make homeownership more affordable on a month-to-month basis, allowing you to manage other expenses or save for future needs. For example, with a 30-year mortgage, your monthly payments will be lower, which might be attractive if cash flow is a concern.

However, the trade-off is the total amount of interest paid over the life of the mortgage. A 30-year mortgage will result in significantly more interest paid compared to a 25-year mortgage. For instance, Zoocasa’s analysis shows that in cities like Vancouver and Toronto, the difference in interest paid between these two mortgage terms can be over $200,000. Even in more affordable markets like Regina, the difference is substantial.

2. Market Trends and Mortgage Options

In 2024, first-time homebuyers in Canada can opt for 30-year amortization periods when purchasing newly built homes with insured mortgages. For those who aren’t first-time buyers, securing a 30-year mortgage requires a minimum 20% down payment or opting for an uninsured mortgage. This flexibility allows more buyers to enter the market, even as interest rates fluctuate.

3. Financial Planning and Long-Term Impact

While lower monthly payments may provide short-term relief, it’s essential to consider the long-term impact on your finances and real estate investment. Paying more in interest means less equity in your home over time and potentially higher costs if you choose to sell before the mortgage term ends. A shorter mortgage term, while requiring higher monthly payments, can build equity faster and save you money in the long run.

4. Local Expertise and Guidance

Navigating mortgage options can be complex, especially in a competitive real estate market like Windsor & Essex County, ON. Partnering with a knowledgeable real estate team, such as The Dan Gemus Real Estate Team Ltd., Brokerage can provide valuable insights and help you make the best decision based on your financial situation and goals. They can offer personalized advice and connect you with trusted mortgage professionals.


Choosing between a 25-year and a 30-year mortgage is a significant decision that affects your monthly budget and long-term financial health. Understanding the trade-offs between lower monthly payments and higher total interest paid is crucial. For more detailed insights on the differences between these mortgage terms, you can refer to Zoocasa’s comprehensive analysis here.

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