Mortgages: Short and Sweet

Short and Sweet

As a clan, young, affluent professionals are partial to particular brands of sneakers (Reebok) and cars (Saab). Recently the group discovered its own mortgage. The 15-year, fixed-rate home loan is favored by married couples in their 30s and 40s who together earn $60,000 or more. Virtually unknown a year ago, this new form of financing now accounts for more than 14% of all loans made by America's largest mortgage bankers.

Lenders like their new concoction because the loans extend for just half the term of the traditional 30-year mortgage. That means there is less risk that a borrower will default or...

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