Who Offers 40 Year Mortgages: The Top 12

Wondering “Who offers 40 year mortgages? Here are the top 12 options worth exploring? If rising home prices have you rethinking your financing strategy, you’re not alone. This post reveals 12 lenders currently offering extended mortgage terms, how they compare, and whether a 40-year mortgage could be your ticket to lower monthly payments. Let’s unpack the real pros, cons, and what to watch for.

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Why 40-Year Mortgages Are Gaining Popularity

As interest rates climb and home prices stay sky-high, more Americans are asking lenders for flexibility—and 40-year mortgages are emerging as a viable solution. These longer-term loans offer smaller monthly payments, which can make homeownership more accessible for first-time buyers, gig workers, or anyone navigating tighter budgets.

How A 40-Year Mortgage Differs From Traditional Loans

Unlike standard 15- or 30-year mortgages, a 40-year loan stretches your payments over a longer time. That means lower monthly bills, but it also means you’ll pay more interest in the long run and may build equity more slowly. For some, it’s a necessary trade-off. For others, it’s a red flag. That’s why it matters who you get the loan from and how it’s structured.

Who Offers 40 Year Mortgages: The Top 12 In The USA

Here’s a closer look at twelve lenders and institutions currently offering 40-year mortgages or similar options across the U.S.

New American Funding

New American Funding stands out by offering 40-year mortgage terms through customizable loan solutions, appealing to borrowers seeking flexibility. Their programs are especially helpful for self-employed individuals or those with non-traditional income, as they support both conventional and non-QM loans. They also offer bilingual support and hands-on loan guidance, making them more accessible for diverse communities. With personalized underwriting and competitive terms, they remain a reliable option for anyone needing a long-term mortgage structure that reduces monthly payments.

Caliber Home Loans

Caliber Home Loans offers a solid path to 40-year mortgages, especially for those dealing with credit challenges. Their focus on non-QM loans means they’re more likely to approve borrowers with less-than-perfect profiles, making them ideal for individuals recovering from past financial setbacks. They also provide refinancing options that allow for term extensions, helping borrowers manage their monthly budgets. Their tools and resources are well-suited for homebuyers who don’t fit the cookie-cutter mold of traditional lending.

Rocket Mortgage (Via Partners)

Rocket Mortgage doesn’t directly offer 40-year mortgages, but they often work with affiliated lenders that do, especially in loan modification scenarios. If you already have a mortgage with Rocket, you may qualify for a 40-year amortization through their hardship relief programs. They also provide some of the best digital mortgage tools in the market, making the refinance or modification process simple and fast. Rocket is ideal for tech-savvy homeowners exploring long-term mortgage flexibility through indirect partnerships.

Carrington Mortgage Services

Carrington Mortgage Services specializes in alternative lending solutions and is known for offering 40-year terms within its non-QM loan programs. They’re particularly helpful for borrowers recovering from foreclosure, bankruptcy, or inconsistent financial history. With experience handling complex mortgage situations, Carrington stands out for offering custom terms that prioritize payment flexibility. Their focus on helping underserved markets makes them a strong contender for buyers who don’t meet conventional loan criteria but still want a path to homeownership.

Angel Oak Home Loans

Angel Oak Home Loans caters to a wide variety of borrowers who don’t qualify for traditional loans. They offer 40-year mortgage terms within their non-QM lending programs, often targeting high-net-worth individuals, real estate investors, and freelancers with irregular income. Their loans frequently come with interest-only options during the initial years, helping to lower payments early on. Angel Oak is a smart pick for borrowers who want creative lending options and who plan to leverage investment potential or asset-based income.

LoanDepot

LoanDepot continues to expand its range of mortgage products, including 40-year terms, particularly through non-QM and FHA streamline refinancing options. They’re one of the larger direct lenders in the U.S., which gives them the scale to offer tailored solutions to non-traditional borrowers. Their simplified application process and strong tech platform help make extended mortgage terms more accessible. LoanDepot is a great option for homeowners and buyers seeking an alternative to rigid 15- or 30-year term structures.

Fairway Independent Mortgage Corporation

Fairway occasionally offers 40-year mortgages through custom-built non-QM and portfolio lending products. They’re known for working with veteran and military families, thanks to their strong VA loan offerings, but also provide alternatives for borrowers who fall outside standard loan criteria. Their loan officers often provide more hands-on, community-based service. While availability of 40-year terms varies by region, Fairway is a trustworthy lender to consider if you want more room in your monthly housing budget.

Guild Mortgage

Guild Mortgage provides flexible lending options that occasionally include 40-year terms, particularly for borrowers seeking to restructure debt or refinance. Some of their government-backed loans may allow longer amortization schedules depending on the borrower’s financial profile. They’re highly customer-focused and work with a broad range of credit scores. If you’re looking for a lender that offers creative solutions without cutting corners on service quality, Guild Mortgage deserves your attention—especially for long-term repayment strategies.

Flagstar Bank

Flagstar Bank is one of the few traditional banks actively offering 40-year mortgage terms, particularly for jumbo loans, real estate investors, and borrowers with low credit scores. Their willingness to structure longer repayment periods within their in-house programs makes them a rare find among national lenders. If you’re buying an expensive property or need flexible underwriting, Flagstar offers one of the most complete menus of extended loan options. They also have physical branches in many U.S. states for face-to-face service.

Bank Of America (Loan Modification Only)

Bank of America doesn’t offer 40-year loans for new purchases, but they do utilize them in loan modification programs. If you’re struggling to keep up with payments, you may qualify for a 40-year amortization to reduce your monthly burden. These modifications are typically available to existing borrowers facing financial hardship. While not ideal for new buyers, Bank of America can be a lifeline for homeowners who need to restructure without refinancing into an entirely new loan.

Wells Fargo (Limited Use)

Wells Fargo has historically used 40-year terms in its loan modification and portfolio lending options but does not openly offer them to new applicants. However, existing borrowers undergoing hardship or seeking mortgage relief may be eligible for a 40-year plan. If you already have a relationship with Wells Fargo, this extended term could be part of a loan modification offer. Their nationwide presence and strong customer service make them a go-to option for personalized solutions.

CMG Financial

CMG Financial offers a range of flexible mortgage products, including 40-year amortization terms on select non-QM and investor-focused loans. They often cater to borrowers with high net worth or complex financial statements that traditional lenders might shy away from. CMG is known for its innovative HomeFundIt platform and for creating creative lending solutions tailored to each borrower. If you’re looking for a lender that builds around your unique situation, CMG is worth exploring for long-term repayment options.

FAQs On Who Offers 40 Year Mortgages

Here are a few questions you may have on 40 Year Mortgages lenders in the US.

What Is A 40-Year Mortgage?

A 40-year mortgage is a home loan where repayment is stretched over 40 years. It typically reduces monthly payments but increases the total interest paid over time. Some 40-year mortgages are fully amortized, while others may be interest-only for a few years before switching to principal-and-interest payments.

Who Offers 40-Year Mortgages In The USA?

Lenders like New American Funding, Caliber Home Loans, Carrington, Angel Oak, and CMG Financial offer 40-year mortgages. Some banks, like Bank of America and Wells Fargo, offer them as part of loan modifications for existing borrowers rather than new home loans.

Is A 40-Year Mortgage Legal In The U.S.?

Yes, 40-year mortgages are legal in the U.S., though they’re less common than 15- or 30-year options. Most 40-year loans are considered non-qualified mortgages, meaning they don’t meet government-backed lending standards.

Are 40-Year Mortgages A Good Idea?

They can be, depending on your situation. A 40-year mortgage may help lower your monthly payments, making a home more affordable. However, you’ll pay more in interest and build equity slower than with shorter terms.

Can First-Time Buyers Get A 40-Year Mortgage?

Yes, some lenders offer 40-year mortgages to first-time homebuyers, especially if affordability is a concern. These loans can help you qualify for a home with a lower monthly obligation, though they come with trade-offs.

What Is The Interest Rate On A 40-Year Mortgage?

Interest rates on 40-year mortgages tend to be slightly higher than 30-year loans. Rates vary by lender and borrower profile but may range from 0.25% to 0.75% higher than traditional mortgages.

Is A 40-Year Mortgage Available For FHA Loans?

Not typically. FHA loans are generally capped at 30 years. However, 40-year terms can sometimes be offered during FHA loan modifications for homeowners struggling to make payments.

Can You Refinance Into A 40-Year Mortgage?

Yes, many lenders allow refinancing into a 40-year mortgage, particularly through non-QM refinance programs or loan modifications. This can lower your monthly payments but extend your repayment term.

Are 40-Year Mortgages Interest-Only?

Some 40-year mortgages include an interest-only period, usually the first 5 to 10 years. After that, the loan converts to fully amortized principal and interest payments. Not all 40-year loans include this feature.

Can I Pay Off A 40-Year Mortgage Early?

Yes, most lenders allow early repayment of 40-year mortgages without penalties. However, always check your loan terms for prepayment clauses to ensure you’re not charged extra for paying it off faster.

Who Qualifies For A 40-Year Mortgage?

Qualification depends on the lender, but you generally need verifiable income, a steady job history, and a fair to good credit score. Non-QM lenders may approve applicants with non-traditional income or lower scores.

Do 40-Year Mortgages Build Equity Slower?

Yes, because payments are stretched over a longer term, you build home equity more slowly. This can be a disadvantage if you plan to sell or refinance within a few years.

Are 40-Year Mortgages Available For Investment Properties?

Yes, some lenders offer 40-year terms specifically for real estate investors. These loans can help reduce monthly outflows and improve cash flow, especially in the early years of ownership.

Is A 40-Year Mortgage Better Than Renting?

If the monthly payment fits your budget and you’re planning to stay in the home long-term, a 40-year mortgage could be better than renting. However, the long-term interest cost should be considered.

What Are The Alternatives To A 40-Year Mortgage?

Alternatives include 30-year, 20-year, and 15-year fixed mortgages, adjustable-rate mortgages (ARMs), and interest-only loans. Choose based on your income stability, long-term plans, and how much interest you’re willing to pay.

Are 40-Year Mortgages Backed By Fannie Mae Or Freddie Mac?

No, 40-year mortgages generally do not qualify for backing by Fannie Mae or Freddie Mac. These agencies typically support loans with a maximum 30-year term.

Do Credit Unions Offer 40-Year Mortgages?

Some credit unions may offer 40-year terms as part of their portfolio loan products. These are less common, but if your credit union offers customized mortgages, it’s worth asking.

Are 40-Year Mortgages Available Nationwide?

Not every lender offers them in all states. Availability depends on the lender’s licensing and regulatory approval in each state. Always check if your chosen lender operates in your area.

Can I Use A 40-Year Mortgage For A Second Home?

Yes, some lenders allow 40-year mortgages for second homes or vacation properties, particularly if you’re using a non-QM loan or investor-focused mortgage product.

What Are The Downsides Of A 40-Year Mortgage?

Main downsides include higher total interest costs, slower equity growth, and more restrictive loan options. You may also face limited availability compared to traditional 15- and 30-year loans.

Are There Government Programs For 40-Year Mortgages?

There are no standard federal programs offering 40-year terms for new loans. However, HUD and FHA may allow 40-year modifications in hardship cases to help lower monthly payments.

Do 40-Year Mortgages Require Larger Down Payments?

Not necessarily. Down payment requirements vary by lender and loan type. Some non-QM lenders may require 10–20% down, while others may accept less with higher interest rates.

Can I Get A 40-Year Mortgage With Bad Credit?

Yes, some lenders offer 40-year terms to borrowers with poor credit through non-QM loans. Expect higher rates and stricter documentation. Improving your credit score may lower your cost.

How Does A 40-Year Mortgage Affect My DTI Ratio?

Because the monthly payment is lower, a 40-year mortgage can improve your debt-to-income (DTI) ratio, making it easier to qualify for a loan or afford a more expensive home.

What Happens After The Interest-Only Period Ends?

If your 40-year loan has an interest-only phase, your monthly payment will increase once the principal payments kick in. Make sure you’re financially prepared for the adjustment when the time comes.

Are 40-Year Mortgages Good For House Flippers?

Not typically. House flippers usually hold properties for short periods and prefer short-term financing. A 40-year loan offers little benefit unless it’s part of a broader investment strategy.

Can You Modify A 30-Year Loan Into A 40-Year Loan?

Yes, through loan modification programs, some lenders allow extending a 30-year loan into a 40-year term to reduce monthly payments, especially if you’re facing financial hardship.

What Documentation Is Required For A 40-Year Mortgage?

Lenders typically require proof of income, tax returns, bank statements, ID, and credit reports. Non-QM lenders may also request asset documentation or letters of explanation for non-traditional income.

How Do 40-Year Jumbo Loans Work?

Jumbo loans exceeding conforming limits may be offered with 40-year terms to help borrowers afford high-priced homes. These often come with stricter credit and down payment requirements.

Can You Get A 40-Year Mortgage On A Manufactured Home?

Some lenders offer 40-year mortgages for manufactured homes, but it’s less common. Be sure to check eligibility based on the home’s foundation, location, and your credit history.

What’s The Minimum Loan Amount For A 40-Year Mortgage?

Minimum loan amounts vary by lender but usually start around $100,000. Some lenders may have higher minimums, especially for non-QM or investor-focused loan products.

Can You Use A 40-Year Mortgage For Construction Loans?

Some lenders may offer 40-year terms as part of a construction-to-permanent loan, especially under portfolio lending programs. Availability will depend on the lender and your financial profile.

Is The Application Process Longer For A 40-Year Loan?

Not usually. The process is similar to other mortgage types, though non-QM loans may take a little longer due to additional documentation and underwriting steps.

Will A 40-Year Mortgage Affect My Home Insurance?

Your mortgage term doesn’t directly affect your home insurance rate. However, some lenders may require certain coverage levels depending on your loan structure or interest-only terms.

Can A 40-Year Mortgage Be Assumed By Another Buyer?

Most 40-year mortgages are not assumable, meaning the loan cannot be transferred to a new buyer. Always check your loan agreement to understand any transfer restrictions.

Is There A Balloon Payment On A 40-Year Loan?

Some 40-year loans include a balloon payment, especially interest-only or hybrid loans. Be sure to ask your lender if your loan will require a lump sum payment at the end.

Are There 40-Year Mortgages For Self-Employed Borrowers?

Yes, many non-QM lenders offer 40-year mortgages tailored for self-employed individuals. They may accept bank statements or asset-based income instead of traditional W-2 documentation.

What Happens If You Sell Before 40 Years?

You can sell your home at any time. The remaining loan balance will be paid off at closing, just like with a shorter-term mortgage. There are no penalties for selling early.

Do 40-Year Mortgages Qualify For Tax Deductions?

Yes, mortgage interest on a 40-year loan may qualify for tax deductions if you meet the IRS requirements. Consult a tax professional to understand how deductions apply in your case.

Can You Get PMI On A 40-Year Mortgage?

Yes, if your down payment is less than 20%, most lenders will require private mortgage insurance (PMI), even on 40-year loans. This can increase your monthly costs.

What Are The Closing Costs On A 40-Year Mortgage?

Closing costs are similar to other loans and typically range from 2% to 5% of the home’s purchase price. Some lenders may charge more for non-QM loan processing.

Is A 40-Year Mortgage Available For Modular Homes?

Yes, depending on the lender and foundation type, modular homes may qualify for 40-year mortgages. Ensure the home meets local and lender requirements for permanent structures.

How Do You Find Lenders Offering 40-Year Mortgages?

Start with online research and compare non-QM lenders, portfolio lenders, and direct mortgage companies. Use mortgage comparison tools or contact brokers to identify 40-year mortgage options in your area.

Can You Get A 40-Year Mortgage With No Down Payment?

Rarely. Most 40-year mortgages require at least some down payment, especially from non-QM lenders. VA or USDA loans with no down payment are usually capped at 30 years.

Does A 40-Year Mortgage Affect Resale Value?

No, the type of mortgage you choose doesn’t affect your home’s resale value. However, longer loan terms may affect how much equity you’ve built up at the time of sale.

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Conclusion

Now that you’ve seen who offers 40 year mortgages: the top 12, the next step is to weigh whether this extended term fits your financial game plan. While not the perfect option for everyone, 40-year mortgages can be a strategic tool in a high-cost housing market. If you’re juggling income irregularities, aiming for lower payments, or restructuring your finances, one of these lenders could help make homeownership more feasible—just be sure to read the fine print.