The Barefoot Investor Scott Pape has issued a stark warning to Aussies thinking about jumping on a controversial mortgage trend. In the United States, President Donald Trump has floated the idea of 50-year mortgages as a solution for first-home buyers, while in Australia, some lenders have already started offering 40-year mortgages.

Aussie resident Tim wrote to the finance expert, asking what he thought about Trump’s 50-year loans. Tim thought it would be a game-changer because the longer loan term would help lower his repayments.

“Given all the homes we’ve been looking at around Albany have increased in value by $20,000 (or more) since the 5 per cent deposit scheme was rolled out, is this worth looking at?” he asked.

Pape said that the idea behind a 50-year mortgage might be appealing for many, particularly for those who “scrimp and stash away” savings, only to find house prices have jumped by significantly more.

“That completely sucks. Yet what sucks even harder is signing up to a 40 or 50-year loan,” Pape wrote in his weekly column.

“It’s literally a death trap: the average first-home buyer is now 38 years old. That means you’ll be making payments at 88. Yet most Aussie blokes are dead by 84!”

Pape said that if you took out a $600,000 loan on a 50-year term, your repayments would be lower than a traditional 30-year loan.

“However, there’s no free lunch. You’ll end up paying $600,000 extra in interest to the bank,” he warned.

In the short term, Pape said you’d pay $353,000 in interest over the first 10 years of the 50-year loan and only reduce your principal by a “teeny, tiny $26,000”.

Pape likened it to “renting from the bank while being responsible for all maintenance, rates and insurance”.

50-year mortgages rejected by most Aussie experts

A 50-year mortgage isn’t a popular idea amongst most Aussie experts either, with 79 per cent of those surveyed by Finder rejecting the idea.

AMP chief economist Shane Oliver said it would just mean people “end up paying even more in interest payments without doing anything to improve affordability”.

UNSW Sydney senior lecturer Nalini Prasad noted the difficulties of servicing a mortgage later in life.