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TECHNICALS
Would a 50 Year Mortgage Work?
Over the weekend, President Donald Trump floated the idea of a 50-year fixed mortgage as a way to improve affordability (CBS News). It sounds tempting — stretch out payments to make monthly costs smaller — but the math tells a different story.
💡 Quick Example – $700,000 Loan
Scenario | Term | Rate | Monthly P&I | Total Interest Paid | Extra Interest vs 30-yr |
|---|---|---|---|---|---|
Standard Loan | 30 years | 6.25 % | $4,310 | $851,607 | – |
Extended Loan | 50 years | 6.75 % (≈ 0.5 % higher) | $4,078 | $1,747,028 | +$895,421 |
Even with the lower monthly payment (only ~$230 less), the borrower ends up paying nearly $900,000 more in interest over the life of the loan.
(Payment and interest calculations verified internally; interest cost comparison consistent with Newsweek and Yahoo Finance).
⚠️ Why It’s Risky
Higher rates: Lenders charge more for longer-term risk — typically 0.25–0.50 % higher. This is already in practice with 15 vs 30-year terms.
Slower equity growth: It could take decades to pay down principal, keeping homeowners “stuck” longer.
Double the lifetime cost: For only a small monthly break, you’ll likely pay twice the total interest.
✅ When It Might Fit
If someone’s goal is simply to lower short-term cash flow and they expect to refinance within 5–10 years, it could offer temporary relief.
But for anyone planning to stay long-term, it’s a very expensive trade-off.
🎯 Bottom Line
A 50-year mortgage might look affordable, but it’s often a costly illusion.
Lower payments today mean dramatically more interest tomorrow.
Realtor Insight: When explaining affordability options, show buyers both the monthly savings and the total cost over time — this makes the long-term impact crystal clear.
Disclaimer: I am not a tax professional. This content is for informational purposes only. Buyers should consult a licensed mortgage and tax professional for personalized advice.
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