How the new ‘game-changing’ 50-year mortgage could affect US homebuyers

In a bid to make homebuying more affordable for Americans, President Donald Trump has proposed the idea of a 50-year mortgage.

The president’s idea faced mixed opinions, sparking a debate about the benefits and drawbacks of longer-term loans.

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Buying a home in the US is tougher than everCredit: Getty

President Trump seemingly proposed a new 50-year mortgage via his social media platform Truth SocialCredit: Truth Social/realDonaldTrump

Buying a home in the US is more difficult than ever due to a combination of record-high prices, spiked mortgage rates, and a lack of housing inventory.

The average age of first-time homebuyers has increased sharply from previous years to 40, with the US housing market slowed in 2025 – a situation that President Trump is aiming to fix.

Trump seemingly proposed mortgages with 50-year terms over the weekend in a Truth Social post, featuring an image of himself next to the 32nd US president, Franklin D. Roosevelt, whose administration created the 30-year mortgage standard during the Great Depression.

Trump wrote “30-year mortgage” above the former president’s image and “50-year mortgage” above his own.

Bill Pulte, the director of the Federal Housing Finance Agency – the top mortgage regulation agency in the country – seemingly confirmed the plans in an X post. 

“Thanks to President Trump, we are indeed working on The 50 year Mortgage – a complete game changer,” wrote Pulte.

BENEFITS AND DRAWBACKS

Currently, 50-year fixed-rate mortgages are not permitted under the Qualifying Mortgages rules spelled out in federal law, meaning that congressional approval would be required to make these mortgages common and widely available.

However, should the 50-year home loan become a reality, it would come along with a range of pros and cons.

SMALLER MONTHLY PAYMENTS

The biggest benefit of a 50-year mortgage is that it would offer homebuyers smaller monthly payments than the standard 30-year mortgage.

For example, if mortgage rates were 6.5%, a 50-year mortgage would cost $564 per $100,000 of mortgage versus $632 per $100,000 for a 30-year loan, Richard Green, a professor at the University of Southern California, calculated on LinkedIn.

This means that for a $500,000 mortgage, the monthly payment would be around $340 cheaper.

Supporters for Trump’s proposed 50-year mortgage idea have argued that this would make purchasing a home more accessible, giving Americans more financing options and flexibility.

“I don’t think a 50-year mortgage is bad. It gives everyone more flexibility financially. You can pay a mortgage off early. Not sure how else to lower home costs in 2025,” wrote Crypto Wendy, a popular cryptocurrency analyst on X.

However, experts have warned that a boost in home demand without increasing the number of properties on the market could push home prices even higher, essentially undoing any potential savings on monthly payments.

What help is out there for first-time buyers?

GETTING on the property ladder can feel like a daunting task but there are schemes available to help first-time buyers. Below we round up top options:

Federal Housing Administration (FHA) Loans: The Federal Housing Administration (FHA) manages the FHA loans program. This may be a good mortgage choice if you’re a first-time buyer because the requirements are not as strict as for other loans.

Homeownership Vouchers: The scheme offers subsidies to use toward buying a home to low-income Americans who are first-time buyers. For more information, contact your local Public Housing Agency (PHA).

Good Neighbor Next Door: Certain teachers, emergency workers and law enforcement officers can take advantage of the Good Neighbor Next Door program. It offers 50% off select properties. In return, you must commit to live in the property for at least 36 months.

State programs: Plenty of states housing authorities offer help in the form of combined closing cost and down payment assistance programs with favourable mortgages rates. To find out what’s available to first-time buyers in your area, get in touch with your state directly.

HIGHER INTEREST PAYMENTS

While a 50-year mortgage would result in lower monthly payments, the longer-term loan would also spike the total amount of interest that Americans pay because the lifetime of the loan is so much longer.

“The longer the life of the loan, the more compensation the lender will demand,” said Realtor.com senior economist Joel Berner.

Longer loans generally have higher interest rates because they are riskier for lenders, exemplified in the difference between mortgage rates for a 15-year loan, at an average of 5.5% last week, versus a 30-year loan, at 6.22%, per Freddie Mac.

Because there are currently no conventional mortgages that have a 50-year term, it is unclear just how much higher rates would be.

Changes to homebuyer age and first-time property purchasers in the United States

First-time buyers and lower-budget buyers are disproportionately affected by rocketing housing costs

Spiraling housing costs have helped push the age of today’s typical homebuyer higher.

Older buyers and repeat buyers are more likely to find success in the market.

In the US, the median homebuyer age reached 56 in 2024.

This is a record high.

In fact, it’s the highest age in the data’s history – dating back to 1981.

Source: Realtor.com

SLOWER EQUITY GAINS

Homeowners who opted for a 50-year mortgage would also gain equity in the home at a slower pace than if they went with the standard 30-year mortgage.

The longer the term of the loan, the longer it takes to build equity in the property because principal payments would be smaller, with experts suggesting that the amount of interest paid to lenders would be 40% higher.

“The slow equity build would make trading up or down very difficult,” Lawrence Yun, chief economist for the National Association of Realtors, told Realtor.com.

“It would also take almost 40 years to pay off half the balance, meaning most borrowers would not begin building meaningful equity until the final decade.”

Extensive research from around the time of the 2008 financial crisis has shown that Americans with a “negative equity” – meaning that they owed more to a lender than their homes were worth – were at much greater risk of defaulting on their mortgage or walking away from it altogether.

“Negative equity is a necessary condition for default. Otherwise, households would sell their houses, pay back their mortgages and keep any remaining funds,” explained the Federal Reserve Bank of St. Louis.

As talk of a 50-year mortgage continues, some homeowners are paying off their mortgages early and buying stocks after the Fed rate cut.

Others are seeing their monthly mortgage rates drop by nearly $1,600 – but “upward bumps” are on the way.

A 50-year mortgage would come with a range of pros and cons, according to expertsCredit: Getty

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