The advice I'd give a "normal" person: take a 30 year fixed-rate mortgage with 20% down for the lower payment. 3.5% isn't exactly a bone-crushing interest rate, so having a manageable payment is well worth the term.

For a Mustachian... it gets a little trickier. It's not all interest and math. I'd suggest not going shorter than a 15 year fixed. Shorter terms than 15 years generally don't have lower interest rates, just higher payments. Another idea would be to take an adjustable rate (ARM) with a 30 year term/due for the lower rate (depending on the lender, it'll probably be close to the 15 year rate, but with a 30 year term), then pay it off as fast as possible. Since you're on this forum, I'm guessing you could pay off a 5/1 ARM before the first adjustment, and a 7/1 ARM for sure. But this option depends on your risk tolerance more than math.

If you take a longer term, in the event of illness/other emergency, you'll have a low payment to fall back on. I would suggest that, since you're not FI, you keep your payment low. Something you could pay with one salary, or off savings for six months, while still covering your other expenses. (Again, I don't know where you are financially- this is just general advice.) Life is what happens when you expect something else.

You probably know all of this... But I find that a lot of people get so excited about paying off mortgage debt, that they shorten their terms so much that they get stuck with a payment that leaves no breathing room. They forget that you're allowed to make double, triple, quadruple, etc payments without contractually shortening your term. Example:

**$300K purchase, $240K loan. 30 year fixed, 3.5% = $1077.71 per month, $147,974 in interest with no extra payments. **

Ew. But...

Pay $565.39 extra a month (equal to a 15 year minimum payment at 2.875%), and you're payed of in 16 years with $73,215.30 in interest.

Pay $1000 extra a month, pay off in 12 years with $53,094 in interest.

Pay $1500 extra a month, pay off in 9 years with $40,435.17 in interest.

Pay $2000 extra a month, pay off in 7 years with $32,694.07 in interest

**$300K purchase, $240K loan, 15 year fixed, 2.875% = $1,643.01 per month, $55,741.03 in interest with no extra payments.**

Pay $434.07 extra a month (same as adding $1000 to a 30 year payment), pay off in 11 years, $41,327.96 in interest.

Pay $934.70 extra a month (same as adding $1500 to a 30 year payment), pay off in 9 years, $31,886.79 in interest.

Pay $1434.07 extra a month (same as adding $2000 to a 30 year payment), pay off in 7 years, $25,997.33 in interest.

Basically, I'm suggesting that you assess your risk tolerance and financial situation. Is it worth paying slightly more interest to have a more manageable payment *while still being able to pay off the loan as quickly as your financial situation allows*, or do you prefer the lower interest amount while being contractually obligated to a shorter term/higher payment? I know Mustachians don't generally deal in risk, but I have a fairly low risk tolerance, so I prefer to insure myself against some kinds of risk. The idea that one of you could lose your job, get sick, get hurt, etc isn't far-fetched. Whether paying more interest is an appropriate form of insurance is your call. (Does this make sense?)

Other advice: work with a local savings and loan or credit union, especially if you go the ARM route. Not only are their rates and fees generally better, you've got a local lender who care more about you and is more likely to reinvest in the community rather than the CEO's bank account. You'll almost definitely have to pay title insurance on a condo (do not get owner's- just the required lender's), and some condo assessment fees. Make sure you account for HOA fees in this choice if you're looking in a development. That my be offset by the difference between renter's insurance and homeowner's though. Finally, you will probably pay a higher rate for a condo.