Won't Need 50-Year Trump Mortgages If The Fed Moves To Cut Rates, Says White House Treasury's Adviser

Author: Shomik Sen Bhattacharjee | December 04, 2025 12:08am

Lower interest rates would likely wipe away the need for President Donald Trump's proposed 50-year mortgage, a senior U.S. Treasury adviser said Wednesday.

Treasury Adviser Says Fed Holds Real Key

Speaking at the Reuters NEXT summit in New York, Joseph Lavorgna, counselor to Treasury Secretary Scott Bessent, said the 50-year loan idea, floated by the White House and the Federal Housing Finance Agency to cut monthly payments, matters less than the Fed's pace of easing.

"We won't need a 50-year mortgage if the Fed was lowering its rates, which I think it will," he said, adding the central bank has been "very slow and uneven on that score" and that policy has stayed "too tight," squeezing housing and other rate-sensitive sectors.

Lavorgna said more decisive Fed cuts that bring policy "to neutral, if not somewhat stimulative" could pull mortgage rates down without forcing buyers into debt for 50 years.

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White House Floats Ultra-Long Loans Amid Crunch

The White House has proposed ultra-long mortgages as one solution to a severe affordability crunch, but critics told the Associated Press that the plan "would do little" to address deeper problems, including a lack of supply and still-elevated borrowing costs.

Average 30-year mortgage rates remain above 6%, according to Freddie Mac, and have stayed over that threshold since 2022, helping keep annual home sales stuck around 4 million, well below the pre-pandemic norm.

Economists Warn Of Costly Long-Term Trade-Offs

A separate Reuters analysis in mid-November found that on a $400,000 loan at 6.5%, a 50-year mortgage would cut monthly payments by about $270 versus a 30-year loan but raise total interest to roughly $953,000 from $510,000, highlighting the long-term trade-off.

Several economists have detailed how Trump's 50-year mortgage push could sharply increase lifetime interest costs and slow home-equity gains, including Moody's Mark Zandi and former Obama adviser Betsey Stevenson.

Photo Courtesy: Image via Shutterstock/ Pla2na

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