White House's 50-year mortgage proposal has one notable benefit but a
number of drawbacks
[November 12, 2025] By
KEN SWEET
NEW YORK (AP) — The White House says it is considering backing a 50-year
mortgage to help alleviate the home affordability crisis in the country.
But the announcement drew immediate criticism from policymakers, social
media and economists, who said a 50-year mortgage would do little to
resolve other core problems in the housing market, such as a lack of
supply and high interest rates.
Bill Pulte, director of the Federal Housing Finance Agency, said on X
over the weekend that a 50-year mortgage would be “a complete game
changer” for homebuyers. FHFA is the part of the federal government that
oversees Fannie Mae and Freddie Mac, which buy and insure the vast
majority of mortgages in the country.
The 30-year mortgage is a uniquely American financial product and the
default way to buy a home since the New Deal. Politicians and
policymakers at the time wanted to create a standardized mortgage that
borrowers could afford and pay off during their working years, when the
average lifespan for an American was 66 years old.
Lower payment
Extending the life of a mortgage to 50 years does decrease a borrower’s
monthly payment.
The average selling price of a home in the U.S. was $415,200 in
September, according to National Association of Realtors. Assuming a
standard 10% down payment and an average interest rate of 6.17%, the
monthly payment on a 30-year mortgage would be $2,288 while the payment
on a 50-year mortgage would be $2,022. That’s presuming a bank would not
require a higher interest rate on a 50-year mortgage, due to the longer
duration of the loan.
But significantly higher interest
Because even more of the monthly payment on a 50-year mortgage would go
toward interest on the loan, it would take 30 years before a borrower
would accumulate $100,000 in equity, not including home price
appreciation and the down payment. That’s compared to 12-13 years to
accumulate $100,000 in equity when paying off a 30-year mortgage,
excluding the down payment.
A borrower would pay, roughly, an additional $389,000 in interest over
the life of a 50-year mortgage compared to a 30-year mortgage, according
to an AP analysis.
Other analysts came to a similar conclusion.
“Extending a mortgage from 30 years to 50 years could double the
(dollar) amount of interest paid by the homebuyer on a median priced
home over the life of the loan and significantly slow equity
accumulation,” wrote John Lovallo with UBS Securities.
Broader housing issues
A 50-year mortgage does nothing to solve one critical issue when it
comes to housing affordability — the lack of supply of homes. States
like California and cities like New York have recently passed
legislation or made regulatory changes to allow builders to build homes
faster with less regulatory red tape.
There’s also the raw cost of homebuilding in the country. Products such
as steel, lumber, concrete, copper and plastics that go into home
construction are now subject to tariffs under President Trump. Further,
many construction jobs were being done by undocumented workers,
particularly in the Southwest, where deportations are impacting the
ability for homebuilders to find enough labor to build homes.
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New homes dot the landscape in Middlesex Township, Pa., on April 19,
2023. (AP Photo/Gene J. Puskar, File)
 “Many of the big things that would
address supply right now are going in the wrong direction,” said
Mike Konczal, senior director of policy and research at the Economic
Security Project.”
Pulte said on X that the introduction of a 50-year mortgage was just
a “potential weapon,” among other solutions the White House has
considered to combat high housing prices.
Americans don’t live long enough
The average age of a first-time homebuyer has been creeping up for
years and is now roughly 40 years of age. A 50-year mortgage would
be difficult to underwrite for a bank for a 40-year-old first-time
homebuyer, who would be 90 years old by the time that home is paid
off. The average life expectancy of an American is now roughly 79
years, meaning there’s 11 years of life expectancy not covered in a
50-year loan.
“It’s typically not a goal of policymakers to pass on mortgage debt
to a borrowers’ children,” Konczal said.
Others have tried longer loans
Other parts of the financial system have extended loan terms, to
mixed results. The seven-year auto loan has become increasingly
common as car prices have risen and Americans keep their cars
longer. Despite longer loan terms, auto loan delinquencies have been
rising, and the average price of a new car is now $49,740 compared
to a price of $38,948 for a new vehicle five years ago.
Student loans were originally designed to be paid off in 10 years,
and now there are multiple payment options that extend repayment out
to 20 years.
Economists pointed out that a 50-year mortgage may do the opposite
of helping with home affordability by causing home price inflation
by introducing more potential buyers into a market struggling with
supply.
Trump downplays idea
After significant criticism, President Trump seemed less enthused
about the 50-year mortgage. When asked by Laura Ingraham of Fox News
about the idea, President Trump said it “might help a little bit”
but seemed to brush it off.
Under the Dodd-Frank Act, the mortgage giants Fannie Mae and Freddie
Mac cannot insure a mortgage that is longer than 30 years, so any
50-year mortgage would be considered a “non-qualifying mortgage” and
would be more difficult to sell to investors. Congress would have to
amend U.S. financial laws in multiple places to allow for 50-year
mortgages, and there seems to be little appetite for Congress to
take this on immediately.
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