'"> ');

Author Topic: US homeowners get tax relief of mortgage interest  (Read 13189 times)

0 Members and 1 Guest are viewing this topic.

Denny Crane

  • New Member
  • *
  • Posts: 23
  • Country: us
  • Always Win - Always will
US homeowners get tax relief of mortgage interest
« on: March 14, 2012, 08:51:07 am »
In the US interest on a mortgage is fully tax deductible!
This represents a $100 million mortgage tax relief giving US homeowners every incentive to borrow as much as they can.

A little known cause of the 2008 financial crisis was the fact that the majority of toxic mortgages were not given to expand home ownership.
They were for re financing existing home loans marketed as a tax efficient way of getting cash from your home.
So while interest charged on a home loan is tax deductible, interest charged on credit cards or a personal bank loan is not.
When an overheated property market caused house prices to surge, people used the equity in their US homes as a tax free credit card. 
With the Fed also keeping interest rates artificially low, it is no wonder the party had to end badly.
If you need a lawyer to get you off, I'm your man. If you don't, the offer is still good!
It's all good
DENNY CRANE - Names on the door


The Prophet

  • Global Moderator
  • Senior Member
  • *****
  • Posts: 364
  • Country: england
  • Financial & Economics commentator
Re: US homeowners get tax relief of mortgage interest
« Reply #1 on: March 15, 2012, 11:33:53 am »
In the UK we used to have MIRAS  (Mortgages Interest Relief At Source) similar to the current US scheme.
This was a scheme introduced in the UK by Roy Jenkins in 1969 in a bid to encourage home ownership; it allowed borrowers tax relief for interest payments on their mortgage.

MIRAS was completely abolished in April 2000 by then Chancellor of the Exchequer and former Prime Minister Gordon Brown.
He argued it had become a "middle class perk."  
Even Prince Charles had campaigned for the abolition of MIRAS

With house prices slumping and the British economy in recession there are calls for it to be reintroduced.  
However, mortgage rates are historically low, effectively giving the same benefit MIRAS gave borrowers when interest rates were around 8-10%.


Tim Fee Snagging Inspector

New Home Expert

  • Global Moderator
  • Guru member
  • *****
  • Posts: 1625
  • Country: england
  • Expert advice for new home buyers
    • New Home Blog
Re: US homeowners get tax relief of mortgage interest
« Reply #2 on: July 18, 2015, 10:30:42 am »
Now the "upper class perk" that is the unfair and an unjust Mortgage Interest Tax Relief for Buy-to Let landlords is being abolished, albeit very slowly
New Home Blog - New Home Expert is committed to providing help and advice for people having issues with their new homes and difficulties with house builders as well as helping potential buyers reduce the risk of possible problems if they do buy.