Overview
- FHFA has not released design details, rates, or a timeline, leaving the proposal exploratory and uncertain.
- Current Dodd-Frank and GSE rules cap conforming loans at 30 years, so a broad rollout would require regulatory changes or congressional action, with private investors likely demanding higher rates.
- Analyses show monthly savings of roughly $200–$280 on typical scenarios but hundreds of thousands of dollars in additional interest and far slower equity build, heightening the risk of being underwater after market downturns.
- Extending loan terms would increase duration and interest‑rate risk for lenders and MBS investors, with analysts warning of limited appetite for ultra‑long assets and potential pressure for longer‑dated hedging instruments.
- President Trump promoted the concept before tempering his enthusiasm as economists and editorial boards criticized it, even as some realtors and investors tout short‑term cash‑flow benefits and easier qualification that could also nudge home prices higher.