Mortgage Insurance is Tax Deductible
SCHomeReporter.com
What types of mortgage loans qualify for the mortgage insurance tax deduction? Loans used for “acquisition indebtedness” — that is, money borrowed to buy, build or substantially improve a residence — are eligible, as long as the debt is secured by the same residence. This includes purchase loans and refinance loans, up to the original acquisition indebtedness. (Money that homebuyers borrowed against the equity in a home or when refinancing a home for any reason other than to buy, build or substantially improve a residence is called “equity indebtedness.”)
Presented by Schiedow Group | Your Real Estate Professionals
When borrowers refinance a piggyback loan they originally used to acquire a property, does the IRS consider the original loan amount as the sum of the two mortgages or only the primary mortgage amount without the second lien included? The IRS considers original acquisition indebtedness to be the sum of the two mortgages. Is deductibility applicable for all loan types? There is no differentiation among loan types.
Feel the Ocean Breezes! PRICE IMPROVED!
What types of properties are eligible for tax deductibility? The deduction applies to “qualified residences,” as defined in the Internal Revenue Code. Generally, that includes the borrower’s primary residence and a nonrental second home. As with mortgage interest, borrowers can deduct mortgage insurance premiums that they have paid on both their primary residence and one other qualified residence each year. Investor loans are not eligible.
619 E Avenida San Jaun South East San Clemente 4 Bedrooms - 2.5 bathrooms - 2,352 SQFT
Who qualifies for this itemized deduction? Households with adjusted gross incomes of $100,000 or less will be able to deduct 100% of their mortgage insurance premiums. Each additional $1,000 of adjusted gross household income reduces the deduction by 10%. The deduction phases out after $109,000.
$1,250,000 - $1,175,000
The IRS does not restrict the deduction to first-time homebuyers.
OCEAN, HARBOR & COLORFUL OCEAN SUNSET VIEWS! COMPLETELY RENOVATED! UNIQUE CORNER FLAT LOT WITH RV STORAGE!
Please contact your tax consultant to see if you qualify for these deductions.
www.619EastAvenidaSanJuan.com
Married individuals filing separate returns with adjusted gross incomes of $50,000 or less will be able to deduct 50% of their mortgage insurance premiums. The IRS reduces the deduction by 5% for each additional $500 of adjusted gross income, phasing out after $54,500. See the table below for details.
The Rise of 2017 As the books were closed on 2016, many economic indicators were on the rise. Some signal good news for those in the market to buy a home. Housing Starts Surge For regions struggling with limited housing inventory, Housing Starts may provide some hope. December Housing Starts surged 11.3 percent from November, the Commerce Department reported. The welcome news follows a disappointing pullback in November and a nine-year high in October. For all of 2016, average monthly Housing Starts were the best since 2007. Building Permits, which signal future construction, fell just short of expectations in December. On another positive note, Existing Home Sales ended 2016 as the best year in a decade. Limited housing inventory continued to push home prices up in 2016. CoreLogic, a provider of consumer, financial and property information, reported that home prices, including distressed sales, rose 7.1 percent from November 2015 to November 2016. The recent rise in home loan rates and the expectation of higher rates in 2017 could slow home price gains this year, CoreLogic reported. Inflation Ticks Up Consumer inflation was up 2.1 percent from December 2015 to December 2016, as reported in the Consumer Price Index. This 12-month increase marks the fastest pace of inflationary growth since the period ending June 2014. Wholesale inflation also ticked up in December, the U.S. Bureau of Labor Statistics reported. The Producer Price Index climbed 1.6 percent from December 2015 to December 2016, which was the largest 12-month gain since 2014.
COMING SOON! Tranquil! Gorgeous! Picturesque
20 Via Soria - Talega 5 Bedrooms - 3.5 Bathrooms - 3,250 SQFT
1,085,000 LOCATED ON A PRIVATE CUL-DESAC IN THE EXCLUSIVE GATED COMMUNITY OF CATANIA!
Rising inflation is worrisome for homebuyers because it reduces the value of fixed investments like Mortgage Bonds and hurts the home loan rates tied to them. Home Loan Rates Still Attractive Home loan rates were able to improve slightly in the first part of January, following the post-election volatility in Stock and Bond markets at the end of 2016. However, positive economic news, rising inflation and transitions under the new Trump administration may provide some headwinds for Mortgage Bonds and home loan rates in 2017. For now, home loan rates remain historically attractive. If you have any questions about home loan rates or loan products, please don't hesitate to contact John Giangardella 949-370-4240 or johngmortgage@gmail.com
LEASING, BUYING OR SELLING | SCHIEDOW GROUP | 949-929-1339
Local Postal Customer ©2015 Coldwell Banker Real Estate LLC. All Rights Reserved. Coldwell Banker Real Estate LLC fully supports the principles of the Fair Housing Act and the Equal Opportunity Act. Each Coldwell Banker Residen&al Brokerage office is owned by a subsidiary of NRT LLC.Coldwell Banker® and the Coldwell Banker Logo, Coldwell Banker Previews Interna onal® and the Coldwell Banker Previews Interna onal Logo, are registered service marks owned by Coldwell Banker Real Estate LLC. Broker does not guarantee the accuracy of square footage, lot size or other informa&on concerning the condi&on or features of property provided by seller or obtained from public records or other sources, and the buyer is advised to independently verify the accuracy of that informa&on through personal inspec&on and with appropriate professionals. If your property is currently listed for sale, this is not intended as a solicita&on. Sales may not represent all brokers. Based on informa&on from the Associa&on of REALTORS®/Mul&ple Lis&ng as of September 2015 Display of MLS data is deemed reliable but is not guaranteed accurate by the MLS. The Broker/Agent providing the informa&on contained herein may or may not have been the Lis&ng and/or Selling Agent.