The Hidden Cost of a 50-Year Mortgage: Nearly $1M Extra Interest in One City
- - The Hidden Cost of a 50-Year Mortgage: Nearly $1M Extra Interest in One City
Gabrielle OlyaDecember 27, 2025 at 6:04 AM
0
HaizhanZheng / Getty Images
President Donald Trump’s proposal to introduce 50-year mortgages promises smaller monthly payments, but borrowers would pay dramatically more in total interest and build home equity far more slowly. A new Realtor.com analysis found exactly how significant that extra interest could be, and in some cities, it’s nearly $1 million extra.
The analysis compared mortgage costs for a traditional 30-year term versus a 50-year in three types of real estate markets. Crunching the numbers revealed an alarming truth: the interest is killer.
High-Cost, Low-Supply Market: San Francisco-Oakland-Fremont, California -
Median listing Price: $954,500
30-year monthly payment: $5,289
50-year monthly payment: $4,682
Monthly savings: $607
30-year total interest: $1,045,105
50-year total interest: $1,949,903
Extra total interest: $904,798
In the San Francisco market, buyers would get a huge reduction in their monthly payment, but the price and interest risks with this type of loan would be extreme, said Joel Berner, senior economist at Realtor.com.
“The extra $904,798 in total interest is a massive long-term penalty,” he said in a news release. “Since supply is stagnant, the new buying power fueled by the lower payment is likely to increase competition and push up home prices, potentially negating the $607 monthly savings immediately by increasing the required loan size.”
Find Out: I Asked ChatGPT What Would Happen If Billionaires Paid Taxes at the Same Rate as the Average Hawaii Resident
Read Next: 9 Low-Effort Ways To Make Passive Income (You Can Start This Week)
High-Growth, Mid-Cost Market: Raleigh-Cary, North Carolina -
Median listing Price: $458,020
30-year monthly payment: $2,538
50-year monthly payment: $2,246
Monthly savings: $292
30-year total interest: $501,497
50-year total interest: $935,667
Extra total interest: $434,170
The monthly savings a 50-year mortgage would provide could act as a bridge for income-constrained buyers who want to live in the desirable Research Triangle area — but the downside is the equity drag.
“This financial tool could accelerate demand and contribute to some home price inflation,” Berner said. “Additionally, the slow equity build-up could lock in buyers for longer, making it challenging for buyers to trade up in five to 10 years.”
Lower-Cost, Stable Market: Akron, Ohio -
Median listing Price: $239,570
30-year monthly payment: $1,328
50-year monthly payment: $1,175
Monthly savings: $153
30-year total interest: $262,311
50-year total interest: $489,406
Extra total interest: $227,095
In lower-cost, lower-income areas, the monthly savings could be make or break for potential buyers. However, the additional interest costs are significant and should be avoided if at all possible.
“In a market where the 30-year payment is already relatively affordable, a 50-year term would mean that the borrower would be taking on $227,095 in extra total interest,” Berner said. “This is a disproportionate long-term cost for marginal short-term monthly savings, unnecessarily extending the path to home equity and eroding long-term financial security.”
More From GOBankingRates
Nearly 1 in 3 Americans Hit by a Costly Holiday Scam, Norton Survey Shows -- How To Avoid This
Here's What Retirees Wasted the Most Money On in 2025 -- and How To Avoid It in 2026
How Middle-Class Earners Are Quietly Becoming Millionaires -- and How You Can, Too
6 Safe Accounts Proven to Grow Your Money Up to 13x Faster
This article originally appeared on GOBankingRates.com: The Hidden Cost of a 50-Year Mortgage: Nearly $1M Extra Interest in One City
Source: “AOL Money”
