15 vs. 30 year terms

[Justin Sandall]

Hey guys,

I have been having a philosophical debate with my partner and wanted your opinions. Our first property has worked out really well as we have cash flowed since day one, have a great renter and were able to buy a property at a discount that had pretty much all the major stuff in great condition.

On that property, we did a 15 year term mortgage to minimize the interest costs during the life of the loan recognizing that our cash flow would be less. We made sure to run our analytics to ensure positive cash flow in this scenario prior to buying.

As we prepare to purchase our 2nd property, I have been opining for a 30 year mortgage to generate improved cash flow. My position is that the increased cash flow will create a bigger/better buffer should any major CapEx befall us as well as allow for the ability to pay out income vs. have increased savings to be put to the next property. In addition, if we don't incur significant expenses, we could always pay extra on the mortgage.

In short, I feel like there are more options with the 30 year term, especially since we are buy and hold investors.

Any thoughts or opinions one way or another? 

Thanks for your time.