Mortgage Insurance Now Tax Deductible

A federal law went into effect January 1st. 2007 making mortgage insurance tax deductible for the first time. The new law allows homebuyers to deduct the cost of mortgage insurance premiums on mortgages obtained in 2007. The change in the law is expected to help low-and moderate income buyer, the ones who are most likely to need mortgage insurance. Mortgage lenders require home buyers to pay for mortgage insurance if they make a down payment of less than 20 percent. The ability to deduct premiums on taxes will steer more people into taking a loan with mortgage insurance instead of one with a higher interest rate because of the tax deductible factor. Piggyback loans should slow because of this. The mortgage insurance agency predicts the average tax savings can range from $350.00 to $3,000.00 per year depending on the loan amount. Check with your tax advisor or accountant for additional info. (source The Pennsylvania Realtor 03/07) for more info feel free to email me: findit@LehighValleyRealty.com