The legislation allows taxpayers who itemize their deductions to deduct premiums paid for mortgage insurance - which typically is required when home buyers purchase their homes with less than 20 percent down.
Mortgage insurance is necessary on loans where you are putting down less than 20%. It protects the bank from losing money if you default on the mortgage. Over the past five years it has been used less and less. Usually the way to go is with an 80% first mortgage and then take out a HELOC(home equity line of credit) or a second mortgage for the rest.
President Bush just signed a new law making mortgage insurance premiums deductible. This should change the equation a bit and possibly make it a better choice. A good mortgage loan officer or a CPA should be able to help you evaluate what’s best in your particular situation.
The new insurance premiums deduction will only apply to mortgage insurance contracts issued in 2007 and is only available to taxpayers whose adjusted gross incomes do not exceed $110,000 ($55,000 for married taxpayers filing separately).
What's happening in the Atlanta real estate market? I'll tell you my humble opinion on things going on in my small part of the world. I'll let you know details about the subdivisions that I specialize in and details about the really nice homes that come on the market.
December 21st, 2006 at 6:16 am
its great for all those who are planning to invest in real estate..
espacially help those who are first time home buyer…