Long-Term Residential

The most common long-term mortgages last 20 or 30 years.

Pros
The major benefits of these loans are their predictability, stability and length. You know exactly how much interest you will pay over the term, and your monthly payments are allocated to both the principal and interest. In early years, the majority of the payment goes to interest, which is tax-deductible. If the mortgage does not have a prepayment penalty, you can make extra payments to shorten the loan term. By making additional payments against the principal, you ultimately lower the cost by reducing the total amount of interest you are charged. 

Cons
Stability comes at a price. Interest rates on fixed-rate loans are usually higher than those starting rates on adjustable-rate loans. Down-payment requirements on conventional, fixed-rate loans can be as high as 10% to 20%. If you opt for a lower down payment, you might have to pay for mortgage insurance, which can cost hundreds of dollars more per month. Mortgage insurance protects the lender in the event you are unable to continue loan payments.