I want to give my statement on 50-year mortgages before this topic vanishes from the headlines altogether, like Elon Musk’s’ Grok-powered ‘Wikipedia alternative’, which 2 weeks later hardly anyone talks about anymore despite an initial avalanche of media coverage. As it turns out, it is easier to promise to build the next Wikipedia than to actually do it.
I’ve never seen such a proud display of economic illiteracy as the condemnation of the proposed 50-year mortgage, assuming it even happens, because given Trump’s track record on completing things, it’s unlikely. Maybe that is an understatement. The vitriol is unprecedented even by policy standards, exceeding the backlash of the attack on Iran during the summer of 2025. I am not sure how this became such a contentious issue.
A few things to consider:
50-year mortgages presumably would be a choice. Either people would not qualify, or see it for a bad deal. Some would sell the home for a profit, well before the 50 years. This is common with other mortgage durations. A mortgage is a loan, which means it’s always possible to pay the principle before it eventually expires. But if the value of the home was to appreciate by , say, 10% in a year vs the interest, then it could still be sold at a profit.
No one is being forced to take out a 50-year mortgage. Many would not qualify, assuming a market was to exist for it anyway. Much shorter durations obviously still exist. It gives flexibility for home buyers who want a lower down payment. This benefits young borrowers who have careers but not enough money for a large down payment. Some argue that it would be “more expensive” but a longer-duration mortgage has cheaper monthly payments compared to short-term mortgages, although obviously total interest is more.
Also, I’ve seen two conflicting opinions–that the 50-year mortgages are a scam or predatory, and at the same time would lead to scarcity. These are inherently contradictory. If the mortgages are such a terrible deal, as others argue, no one would want them. If this were an exceptionally bad deal, borrowers would default, hurting the bank, which would be forced to undertake the difficult, lengthy and costly process of repossessing the home and evicting the owner. Because lenders are competing in terms of offering quotes, it helps to keep the market honest.
I have also seen it likened to “renting from the bank,” but this is also false. A mortgage is not at all like renting. It’s the opposite, because as time passes, the size of the interest payments decline, as shown by the amortization chart below for a hypothetical 30-year mortgage at 6%:
Mortgages can act as a natural hedge against inflation because they lock in a fixed payment even as prices rise. Rent, by contrast, typically increases over time, often in line with, or even faster, than inflation.