In the first quarter of this year , almost 30 percent of people who refinanced their mortgages cut the duration to either 15 or 20 years down from 30 years.
That is the second highest level since 2002 with 35 percent, but still short of the all-time high of 42 percent in 1992.
Across the nation, 15-year fixed loan –rate averaged 2.97 percent according to Freddie Mac’s latest survey. That was the lowest rate since the agency started keeping track of that loan in 1991. The 30 year also set a record low at 3.75 percent.
Reducing debt seems to be the driving force for the strong response and a shorter term may have some tax advantages as well. You restart the mortgage amortization and pay more in interest initially, this result in a good tax deduction for a few years.
SOURCE (The New York Times)