Does a 50-year mortgage really help homebuyers? 

Over the weekend, President Donald Trump floated the idea of creating a 50-year mortgage to help tackle the housing affordability crisis that has left many potential homebuyers on the sidelines. But doing so would present a whole new set of challenges.

Shortly after Trump announced the idea in a Nov. 8 post on Truth Social, Federal Housing Finance Agency Director Bill Pulte amplified the idea on X, calling it "a complete game changer." Pulte later said a 50-year mortgage "is simply a potential weapon in a wide arsenal of solutions" to the housing affordability problem.

The real estate industry's reaction was more subdued, with some experts highlighting significant drawbacks.

Here are five things to know about 50-year mortgages.

Monthly mortgage payments would be lower

Stretching out a mortgage to 50 years would decrease monthly payments, meaning buyers could spread out the high cost of a home purchase over a longer period — but in reality, there wouldn't be a huge difference in savings, according to Joel Berner, senior economist at Realtor.com.

Berner estimates that a 50-year loan would save "at most" about $250 per month compared to a 30-year loan. Berner came to this conclusion by comparing what the costs would be for a $400,000 home — with a 10% down payment and a 6.25% rate — for 30-year and 50-year loans.

"I say 'at most' because I assumed the same rate for both, which would probably not be the case," Berner said, noting that 50-year rates would probably be higher in the same way that 30-year rates are higher than 15-year rates.

"The longer the life of the loan, the more compensation the lender will demand," Berner said.

Borrowers could pay twice as much interest

While monthly payments would be somewhat lower, the total interest paid to lenders would be significantly higher. Berner estimates that a borrower would pay $438,156 in interest on that $400,000, 30-year loan; stretch that to 50 years, however, and the interest would total $816,396.

Because the bulk of a borrower's monthly mortgage payment typically goes toward interest (not the principal) for the first several years of a loan, it would take longer to build equity with a 50-year loan. That could mean more homeowners are underwater on their home for longer, "potentially causing a ripple effect in value when short selling/defaulting could be the only option," said Nicollette Chapman, senior vice president at Zonda, in an article for Builder.

Borrowers considering a 50-year loan should be thinking about it in the context of their long-term financial goals, according to Samir Dedhia, CEO of One Real Mortgage.

"With such a long loan term, you build equity very slowly and pay far more interest over time, which limits wealth-building," Dedhia said in an email. "So while it can provide short-term payment relief, it only works if consumers fully understand the trade-offs and if it's paired with broader efforts to increase housing supply. Otherwise, we're just stretching the debt, not creating real affordability."

Home prices could increase

Berner also recommended focusing on increasing housing supply, warning that a longer loan term could worsen housing affordability since it doesn't solve the underlying problem of insufficient supply.

"More flexible financing is essentially a subsidy for housing demand, which will add to the pool and buying power of homebuyers without increasing the supply of homes, which will drive home prices up," Berner said. 

Dedhia raised concerns about home prices as well, noting that there's "a real possibility that lower payments could push home prices even higher, since buyers qualify for more and sellers adjust."

A more practical way to address affordability, according to Berner? "The administration would do better to reverse tariff-induced inflation, which is keeping the rates on existing mortgages high, and to encourage the expansion of housing supply by promoting homebuilding."

New legislation would be needed to make it work

In addition to offering uncertain financial benefits, a 50-year mortgage doesn't meet the threshold of a qualified mortgage under the Dodd-Frank Act. That's important for lenders, because a qualified mortgage is eligible for support from Fannie Mae and Freddie Mac if a loan goes bad.

Changing the existing rules would require congressional approval and take up to a year to complete, according to Jaret Seiberg, a housing policy analyst at TD Cowen, in a report from CNBC.

Lenders and consumers could be taking on more risk

The Mortgage Bankers Association also expressed a lack of enthusiasm for the idea. A spokesperson for the MBA noted that, given the limits of loan protection on a 50-year mortgage, lenders may not want to offer the product. 

It's a risky proposition for homebuyers too.

"Our concern is that any affordability benefit derived from expanding the mortgage term to 50 years would be offset by increased borrower risk and slower borrower equity growth resulting from the extended amortization period, especially given the expected slowing of home price growth," MBA said in a statement.