President Donald Trump is pitching a 50-year mortgage, an idea federal housing officials are calling a potential “game changer” as home prices continue to climb nationwide.
New data released this week by the Northeast Florida Association of Realtors shows the average home in the region now sells for $385,000. With affordability tightening, some buyers are wondering whether stretching a mortgage out over five decades could make homeownership more attainable.
To find out what the numbers actually look like, News4JAX spoke with local loan officer Jason Kindler at First Coast Mortgage Funding. The product doesn’t exist yet but the proposal is sparking conversation.
“They are not out yet, but Trump came out and said it was something potentially on the table,” Kindler said. “What it means is you pay less per month, you pay it over a longer period of time.”
Kindler says the concept is gaining interest as affordability remains a major challenge, especially in Jacksonville.
“Affordability is a problem,” he said. “You can cut the values of properties — which we don’t want — or you can come up with different products. A 50-year loan could potentially help someone get into a house.”
To test it out, Kindler plugged the numbers into a calculator using a $300,000 loan amount and a 6.5% interest rate.
The monthly payment on a traditional 30-year mortgage came out to $1,896. With a 50-year mortgage, the payment dropped by about $200 a month, but at a steep cost.
“You pretty much double the interest,” Kindler said, noting the borrower would end up paying more than $1 million over the life of the loan. “Is this the best product? Not necessarily over the long term. But if it helps someone get into a house, then it does have some legs to stand on.”
When asked what it says about today’s market that a 50-year mortgage is even being considered, Kindler said there’s a clear problem.
“It says we have an affordability issue,” Kindler said.
The idea is still only a proposal but the discussion highlights the growing pressure on homebuyers searching for relief.