When a potential house buyer sets the process of actually acquiring one, the first and foremost thing that comes to his mind is the interest rate. Its an obvious process since its rate of interest and related package which one subscribes to can make a huge difference in the ultimate payment dole out. The difference can run into tens of thousands of dollars if the instrument or package selection was not too prudent.

But having said that, interest rates are certainly not the only key point which demands your attention while looking at mortgage possibilities. There are other crucial variables which are equally important. The most pertinent issue is whether to go for a fixed interest rate instrument or to choose from many variable-rate mortgages which are available to the customers in the market now.

Precise tenure of the mortgage is another key point. Even with fixed-rate mortgages, a broad time span is available for the customers --- ranging from 15 years on the minimum period side and 30 years on the maximum period side.

Some years ago, a famous scientist had jokingly called "the power of compound interest" as the most powerful force in the universe. The point was missed on no one. When accumulated on a year to year basis, interests can turn into a substantial sum out of a modest principal amount. Innumerable proofs are there to substantiate this point.

Money in a savings account can double within a decade or so even at a moderate or low rate of interest. Similarly, on a $100,000 mortgaged house for a period of 30 years, the actual interest payment itself can run into several hundred thousand dollars.

On the other hand, if the mortgage period is 15 or 20 years, the interest outgo on a cumulative basis is on the lower side vis-à-vis taken on a 30 years term. But that entails paying a heftier monthly instalment in a term policy for a lesser number of years. So the tenure of your mortgage needs to be carefully decided which will depend upon your own analysis of your resources, your priorities and your affordability.

Someone who is prepared to control expenditure for a shorter time will definitely opt for a shorter mortgage so that the debt should get soon off his head and he should recommence his luxurious or less restrained lifestyle. But if someone is willing to carry on less burden for a longer time, his preference will certainly be a longer tenure.

For all those who intend to go for a shorter, faster mortgage, our advice is to talk to your mortgage or real estate agent and ask them to do some quick calculation as how much of savings you can accumulate through short term mortgages.

Chances are you may not find the scenario much encouraging. By resorting to a 15-year or 20-year mortgage you are not only committing to a higher monthly instalment obligations but also choking the savings stream. There certainly is more flexibility for savings with a long tenure mortgage since monthly instalments are on the lower side.

An advisable strategy is to opt for a 30-year mortgage and every year an additional one month payment each year through some fiscal discipline on your part. This way the debts will also come down much faster than the prescribed time frame without putting any significant burden on you. What ultimately counts is your own affordability, your own circumstances and resources. Consulting with a reputed real estate agent would not be a bad idea since he can provide all the information you want before setting the ball to roll.