Unpacking the White House’s proposal for 50-year mortgages

Owning a home has long been part of the American dream. But for many people, that dream remains just out of reach due to rising home prices, limited inventory, and elevated mortgage rates in recent years.

Enter a new suggestion: changing the average mortgage length from 30 years to 50 years, a move proposed by the Trump admin earlier this month as a way to make homes more affordable.

While the finer details are currently being fleshed out by the Federal Housing Finance Agency, the idea has drawn both praise and criticism from policymakers.

The arguments

Supporters of 50-year mortgages—which already exist in countries like Japan and Switzerland—note that spreading house payments over 50 years helps lower monthly bills, making homes more accessible for first-time buyers and lower-income Americans.

• For example: someone looking to purchase the median US home (priced at $415,200) with a 10% down payment and an average interest rate (6.17%) would see their payments decrease from $2,288/month to $2,022/month.

On the flip side: The idea of 50-year mortgage terms also carries a number of potential drawbacks. The largest roadblock stems from federal legislation approved after the 2008 financial crisis, which explicitly limits most regulated mortgages to a maximum of 30 years.

Critics also note that:

• Total interest on a 50-year mortgage would be nearly double that of a 30-year agreement, leaving homeowners to build equity slower than a sloth on NyQuil.
• Americans would be far less likely to fully pay off their home in their lifetimes.
• Longer-term mortgages decrease flexibility for consumers, making it harder to sell quickly, refinance terms, and make future home purchases.

Looking ahead… Making 50-year mortgages widely available to Americans would require significant changes to US federal policy, meaning broad adoption is unlikely anytime soon. But the idea is slowly gaining traction among a certain subset of decision makers.