Fifty-year mortgage could saddle borrowers with nearly $400,000 more in interest

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However, that modest monthly relief comes at a steep price: “A borrower would pay, roughly, an additional $389,000 in interest over the life of a 50-year mortgage compared to a 30-year mortgage,” the AP analysis concluded. That figure assumes lenders would not charge a higher rate for the longer-term product—a scenario many economists doubt.

John Lovallo, an analyst with UBS Securities, reached a similar conclusion. “Extending a mortgage from 30 years to 50 years could double the (dollar) amount of interest paid by the homebuyer on a median priced home over the life of the loan and significantly slow equity accumulation,” Lovallo wrote.

Rebecca Richardson, a Charlotte-based mortgage broker, crunched the numbers: “If you borrowed $425,000 at 6.5% over 30 years, you’d pay $542,064 in interest. Over 50 years, you’d pay $1,012,478. That’s an extra $470,414 just to lower your monthly payment by $290. You’re not saving money… you’re just dragging out the debt,” Richardson told Mortgage Professional America.

Equity buildup slows to a crawl

The extended timeline means borrowers would build equity at a glacial pace. According to the AP, it would take 30 years to accumulate $100,000 in equity on a 50-year loan, compared to just 12 to 13 years on a 30-year mortgage—excluding home price appreciation and down payment.

“It’s typically not a goal of policymakers to pass on mortgage debt to a borrowers’ children,” said Mike Konczal, senior director of policy and research at the Economic Security Project.



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