The Truth about 50 Year Mortgages: Are They Worth it for Montana Home Buyers?

As housing prices rise and interest rates stay high, there has been growing discussion about the possibility of 50 year mortgages entering the U.S. market. The idea sounds appealing at first because spreading payments over fifty years would lower your monthly cost and make homeownership feel more attainable for many families.

But is it really a good idea, especially if you are building a custom home in Montana? At JCH Construction and Development Inc., we have seen how financing choices shape the long term picture for homeowners. Here’s what you should know about how a 50 year mortgage could compare to a traditional 30 year loan and why that lower monthly payment might come with a much higher price tag.

What Is a 50 Year Mortgage?

A 50 year mortgage would work just like a 30 year loan, except your payments would be spread over a much longer term. That means each monthly payment would be smaller, but you would end up paying significantly more in interest over time.

While these loans are not widely available in the U.S., they are already being discussed as one possible response to rising home costs and interest rates. For Montana home buyers and custom home builders, the idea could sound tempting because of the smaller payments, easier qualification, and more flexibility in the budget.

The key is understanding how the numbers really play out over time.

Real Numbers: 30 Year vs 50 Year Mortgage

Let’s look at a real-world example based on a $400,000 home loan at 6.5 percent interest.

With a 30 year mortgage, the monthly payment would be about $2,528. Over the full term, you would pay roughly $510,000 in interest, bringing your total cost of the loan to about $910,000.

If the same loan were stretched to 50 years, the monthly payment would drop to about $2,255, which is around $273 less per month. However, the total interest paid over the life of the loan would rise to about $953,000, making the total loan cost around $1.35 million.

That means in this example, a 50 year loan would cost roughly $442,000 more in interest than a 30 year loan.

How the First 5 Years Compare

The difference becomes even more noticeable early in the loan. In the first five years, a 30 year mortgage would apply about $25,500 toward principal and about $126,000 toward interest.

On a 50 year mortgage, only about $6,200 of your payments would go toward principal, while nearly $129,000 would go to interest.

That means during the first few years of owning your home, almost every dollar of your payment would go to interest, and you would build very little equity. By comparison, the 30 year loan builds roughly four times more equity over the same period.

Potential Benefits of a 50 Year Mortgage

For some buyers, there could be reasons to consider a longer term loan if it ever becomes available. The lower monthly payment could help some people qualify for a higher priced home or make a new build more manageable in their budget.

It could also allow more flexibility to use monthly cash flow toward upgrades, higher quality materials, or other investments while still maintaining affordable housing costs.

The Drawbacks

The tradeoffs would be significant. A 50 year mortgage would mean paying much more in interest over time and building equity very slowly. Because of the extended term, many homeowners could still be paying a mortgage well into retirement.

It would also limit flexibility later on. If you sold your home within the first ten years, most of your payments would have gone toward interest rather than principal, leaving you with less equity to put toward your next property.

Finally, because the loan term is so long, even a small increase in interest rate would make the total cost of borrowing much higher than shorter term loans.

What Makes Sense for Montana Homeowners

When we help clients build custom homes in Helena and across Montana, we always look at the full financial picture. While lower monthly payments can make things easier now, the long term cost and flexibility matter much more.

For most Montana homeowners, a 30 year fixed rate mortgage remains the smarter option. It helps you build equity faster, pay off your home sooner, and save hundreds of thousands of dollars in interest.

However, if lenders eventually begin offering 50 year terms, they could make sense for specific situations such as buyers planning to refinance within a decade, or those prioritizing lower payments during an expensive build phase.

Final Thoughts

A 50 year mortgage might seem like a solution to rising housing costs, but the math tells a different story. While it could make a monthly payment more manageable, the long term price is steep.

At JCH Construction and Development Inc., we help homeowners plan realistically for every stage of building, from budgeting and design to financing and move in.

Contact us for a free pre-build consultation. We’ll walk you through realistic cost expectations, site requirements, and design options tailored to your property.