Final answer:
An amortization schedule is a correct tool to use when comparing traditional versus 15-year mortgages, as it breaks down payments and showcases the long-term interest benefits of a shorter loan term.
Step-by-step explanation:
A tool that borrowers can use to gauge the benefits or drawbacks of a traditional versus a 15-year mortgage is the: B) Amortization schedule.
An amortization schedule is a table detailing each periodic payment on a loan and is typically used to understand the breakdown of principal and interest in each payment over the life of a loan, such as a mortgage. When comparing a traditional 30-year mortgage to a 15-year mortgage, an amortization schedule will show that while payments are higher for a 15-year term, the total interest paid over time is considerably less compared to a 30-year term. This is because the loan is being repaid faster, which reduces the amount of time interest can accumulate.
Conversely, the Credit report, Loan estimate, and Truth in Savings disclosure are tools that do not directly assist in comparing the two mortgage lengths but serve other purposes in the borrowing process.