Donald Trump’s proposal to introduce 50-year mortgages in the United States is stirring debate south of the border, but housing experts say the idea has virtually no chance of catching on in Canada — a country that has spent nearly two decades shortening, not lengthening, amortization periods.
Trump revived the idea this week with a social media post comparing Franklin D. Roosevelt’s 30-year mortgage era with his own vision of a 50-year loan. He later told Fox News that stretching repayment over five decades would simply mean “you pay less per month,” arguing it could help affordability.
But economists say the plan is far from a solution. Joseph Gyourko, a real estate finance professor at the Wharton School, says the appeal of smaller monthly payments hides a steep price: borrowers would pay “a whole lot more” in interest over the life of the loan. Based on Associated Press calculations, a buyer of an average U.S. home — currently priced around US$415,200 — would pay nearly US$389,000 more in interest on a 50-year mortgage than on a 30-year one.
Because such loans amortize extremely slowly, Gyourko warns that borrowers barely build equity and are more vulnerable to default if housing prices fall. “I would tell my kids… don’t do this,” he said.
University of Southern California housing expert Richard Kent Green echoed that concern, calling the idea more “gimmick” than meaningful policy. He noted that lenders would likely charge higher interest rates for 50-year loans, wiping out most of the monthly savings borrowers expect.
For Canada, analysts say the proposal is a non-starter — not only because of risk, but because the entire structure of Canada’s mortgage market is different from the U.S.
In the U.S., mortgage lenders bundle loans into mortgage-backed securities and sell them to investors, allowing institutions to safely lock borrowers into fixed rates for 30 years or more. In Canada, mortgages are backed by bank deposits — savings accounts and GICs — which typically have timelines of just five to 10 years. Because lenders carry more of the risk, ultra-long amortizations simply aren’t feasible.
Penelope Graham, mortgage expert at Ratehub.ca, says Canada has moved in the opposite direction over the last 17 years. After briefly allowing amortizations of up to 40 years in 2007, the federal government quickly reversed course following the U.S. mortgage crisis. Ottawa gradually cut amortizations to 35 years, then to 30, and finally to 25 years for insured mortgages — where they remain today. Uninsured borrowers can go up to 30 years.
While insured first-time buyers were recently allowed to stretch to 30 years for newly built homes, Graham says that is the only loosening Canada has seen — and she does not expect a return to 40-year mortgages, let alone 50-year terms. “The longer a mortgage is, the more inherently risky and expensive it is,” she said.
Mortgage Professionals Canada supports expanding 30-year insured mortgages to all buyers but emphasizes that any change must protect financial stability. Mortgage expert Ron Butler believes a universal 30-year term is likely on the horizon, but warns that will be the limit. “The government likes the fact that prices are coming down,” he said. “They don’t want to create artificial stimulus with a 40 or 50-year amortization.”
For now, housing experts agree: Trump’s proposal may generate headlines, but in Canada — with its risk-averse lending system and strict regulatory approach — a 50-year mortgage remains firmly off the table.