A 40-year mortgage should be the new American standard for first-time homebuyers, two-time presidential advisor says

https://fortune.com/2024/08/29/40-year-mortgage-first-time-homebuyers-john-hope-bryant/

by FUSeekMe69

30 comments

  1. I hear 50-year mortgages will be standard in the 2030’s

  2. Not going to happen. If you factor in a slight increase in the interest rate there is practically zero savings. There is a reason the 30 year has been standard beyond that the difference in payment is negligible.

  4. If they’re trying to solve for affordability, this is not the answer. We need to end corporate ownership and investor speculation in the housing market. Ban foreign ownership of residential properties. Incentivize the market with larger tax credits for first-time home buyers. Ease restrictions on new home construction and zoning. There are so many better options than pushing 40-year mortgages.

  5. “Should” be?! No. It definitely should not be. What was he advising, dog poop cleanup?

  6. They have been doing the same for vehicles for years. It used to be that a 2 year car loan was standard. The as cars got more expensive they went to 3 year loans then 5 year loans. Now you can get a 7 year car loan.

    40 year mortgages might make home ownership more affordable but would also tie someone to a home for life. With a 40 year amortization your house would not appreciate fast enough to offset the increased interest costs.

  7. I’d be willing to do this, as long as I had 0% interest.

  8. No this isn’t the way. We should be building much more housing instead to ease our supply problem.

  9. Eventually we will do 200 year mortgages and let our great great great great grandchildren deal with it. Just kick the bucket as far down the road as possible. Always a good idea.

  11. They want to suck our blood more than they already are?

  12. If you need more than a 30 year mortgage to own a home, you can’t afford to buy a house

  13. Some more context from inside the story for you:

    “Why discriminate against somebody because they’re older? That’s crazy,” he said. “Let them buy that house just like a 20-year-old would, and who knows? Maybe they’ll surprise us and live to 100.” 

    To Bryant, the 40-year mortgage means lower monthly payments on an appreciating and assumable asset at a moment in time when a lot of people can’t afford to buy a home. The 30-year mortgage wasn’t something thoroughly thought out; it was born out of the Great Depression, and everything needs an upgrade eventually, Bryant said. America has a huge [housing problem](https://fortune.com/2023/08/11/root-cause-housing-affordability-crisis-crunch/) right now. Home prices are high, and so are mortgage rates. There aren’t enough homes, resulting from years of underbuilding in the aftermath of the Great Financial Crisis and [decades of policy failure](https://fortune.com/2023/12/16/california-housing-crisis-policy-failure-threaten-rest-of-the-country/). The lock-in effect, a temporary phenomenon that occurs when [mortgage rates](https://fred.stlouisfed.org/series/MORTGAGE30US) soar so swiftly, is another factor at play—and it’s keeping people from selling their homes…. 

    “Does the market have a better idea for solving affordability and broad access, still rooted in free enterprise and capitalism?” he asked. “We’re not talking about socialism or communism or some crazy stuff … If somebody has a better idea, I’m all ears. I’m sure that when car loans went from three-year and four-year terms to four- to eight-year terms, I’m sure that people said that’s crazy.” 

  14. all home buyers with qualifying credit should have a locked interest rate at no more then 2% for homes in value between $1-$999,999.. We should not normalize or standardize longer mortgages, we should standardize a basic interest rate purchase and 15 year mortgages.. no one wants to pay for a home for their entire life..

  15. 40 Year Morgage? … so it can be your first and your last?

  16. So instead of lowering interest rates they decide people should pay even more for an unaffordable home. Great plan idiots.

  18. Yes so the bank can take back what is almost yours when you die of diabetes at 68.

    70% of the United States has weight and pre diabetes issues…. And we’re talking about 40 year payment plans, over half the country will need loans for rascal scooters 🛴 by 2035

  21. Why don’t they just make it 90 years so the average person will die it before it’s paid off and build no equity?

    That’s what we’re really trying to say here, right? Get fucked because we use your basics as a vehicle for us to get rich. Why not just take it to it’s logical conclusion?

  22. I cannot wait for the “Generational Mortgage”

    Sure your idle activities destroyed the world for your grandkids but now you can take an active hand! Low rates of 12% if you take a 90 year ARM!

  23. The new standard should increase the population’s debt? What the fuck is this guy smoking?

  24. Or go interest-only and make it an infinite term mortgage.

    Both dumb ideas.

  25. People are working 50 hours a week and living out of their cars, and the best you got is a 40 year mortgage?

    I have a really crazy idea, a lot of people may disagree, but what if we paid people enough to live off of, and housing costs weren’t extortionately high?

  26. What they really need to do to solve for affordability are two things

    1) ban private equity and sovereign wealth fund ownership of single family homes

    2) review restrictive zoning and allow for more flexibility in density expansion

  27. To keep prices high and people forever in debt. Stupid article

  28. After 10 years on a 40 year mortgage at 7% interest, you’ve pad off 6.6% of your debt. Curious how much you’ve paid toward the bank in this decade?

    I’d be for this if it wasn’t yet another housing subsidy to support/ramp up high prices and if it allowed paying it down early. The former point kills this entirely for me. Overnight, housing would shoot through the roof because “affordability” improved.

  30. Loan companies are suuuuuper pissed about this lol

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