Most U.S. mortgages use a 30-year term. The Trump administration has proposed allowing a 50-year mortgage backed by the federal government, a change Federal Housing Finance Agency Director Bill Pulte called “a complete game changer.” Backers say it could help prospective buyers afford monthly payments. Critics — including some conservatives — say it prolongs debt, benefits banks, and delays homeowners building equity.
What would a 50-year mortgage do to monthly payments and total cost?
Spreading payments over 50 years lowers monthly payments but increases lifetime interest dramatically. Using a $400,000 home, 6.25% interest and 10% down, Realtor.com senior economist Joel Berner estimates a 50-year loan would save at most about $250 per month versus a 30-year loan. But total interest would be far higher: about $816,396 on the 50-year loan versus $438,156 on the 30-year loan — roughly $378,240 more, or 86% more interest over the life of the loan. Berner notes his example assumes the same rate for both terms; in practice lenders would likely charge a higher rate for a longer loan, widening the gap.
Why would lenders and borrowers choose a 50-year mortgage?
Buyers could benefit from lower monthly payments that might make homeownership possible now. Lenders could benefit from a longer period to collect interest. But many experts doubt broad consumer uptake. Bruce Marks, CEO of the Neighborhood Assistance Corporation of America, points out prior attempts at 40-year terms did not gain traction and says a 50-year option could be “even worse,” leaving borrowers with little wealth-building from homeownership.
Chris Hendrix of NBKC Bank warns that standard amortization front-loads interest, so borrowers pay mostly interest in the early years. “You’re going to be paying almost all interest for the first 10 years. It’s really akin to an interest-only loan at that point,” he says — an effect that would be more pronounced on a 50-year loan than on a 30-year loan.
Are there legal and policy hurdles, and are there better solutions?
There is uncertainty about implementation. National Economic Council director Kevin Hassett said the proposal may require legislative changes. Under Dodd-Frank rules, mortgages longer than 30 years don’t meet the “qualified mortgage” definition, making them ineligible for backing by Fannie Mae and Freddie Mac. Without that backing, lenders would be hesitant to issue widespread 50-year loans.
Hassett argued that homeowners still build equity as property values rise, suggesting slower principal paydown may be less of a concern if prices appreciate. Critics counter that relying on price appreciation isn’t a robust answer for long-term household wealth.
Many analysts say the 50-year mortgage is not the best way to improve housing affordability. Berner recommends other actions: reducing tariffs that have raised costs and mortgage rates, and expanding housing supply through increased homebuilding. Hendrix notes demographic trends — the median homebuyer age is high and first-time buyer age is rising — and supports policies that lower rates and assist first-time buyers. Marks suggests policies to prevent large corporate buyers from outbidding individuals and to preserve the 30-year mortgage as the “sweet spot” that has historically supported wealth-building for American homeowners.
Timing and next steps
Officials are evaluating legal questions and potential legislative needs. If implemented, a 50-year mortgage could provide short-term monthly relief for some buyers but at the cost of much higher total interest, slower equity accumulation, and longer exposure to debt. Policymakers face tradeoffs between immediate affordability and long-run household wealth, and many experts urge focusing on lowering rates, building more homes, and protecting the 30-year mortgage model.
