Since mortgage insurance is tax deductible through 2013, now is a great time to buy a home. According to the Act, mortgages that qualify are those that were used to buy, build, or substantially improve your homes, and are secured by the same residences.
San Diego, CA (PRWEB UK) 21 February 2013
According to an article on lexology.com titled Congress’s passage of the American Taxpayer Relief Act of 2012, The American Taxpayer Relief Act of 2012 recently approved by Congress will allow mortgage insurance to be Federally tax deductible for 2012 and 2013.
Shanne Sleder, a San Diego mortgage broker with The Mortgage Planners, responds to the recent news.
“Since mortgage insurance is tax deductible through 2013, now is a great time to buy a home. According to the Act, mortgages that qualify are those that were used to buy, build, or substantially improve your homes, and are secured by the same residences. These types of qualified loans are called ‘acquisition indebtedness’. You are eligible to deduct the full amount of your mortgage insurance on these loans up to a certain gross income limit. After that, the deduction starts to decrease” said Mr. Sleder.
“Loans that were borrowed against the equity in a home or for any reason other than to buy, build or substantially improve a residence are called ‘equity indebtedness’. These loans are not qualified for the tax exemption under the new act,” explained Mr. Sleder.
When asked about which types of home loans qualify for the tax deductions under the Relief Act, Mr. Sleder clarifies that there is no differentiation among which loan types are tax deductible.
“Your loan could be a fixed loan or an ARM, it could be a conventional loan or government loan like FHA and still qualify for the mortgage insurance tax deduction,” explained Mr. Sleder.
Furthermore, only mortgages on qualified residences are eligible for the deduction.
“Qualified residences are usually the borrower’s primary residence or a second home that’s not rented out,” explained Mr. Sleder.
Mortgage Insurance has been tax deductible in the past, but was not extended in 2012. The new law makes it retroactively tax deductible for 2012 and extends it through 2013.
“It is great news for those looking to buy a home, but haven’t been able to do so in the past years for whatever reasons. The Act could get extended again, but it’s uncertain,” said Mr. Sleder.
San Diegans who are looking to finance a home purchase can contact the experts at The Mortgage Planners.
About The Mortgage Planners
The Mortgage Planners is a full service mortgage lender based in San Diego, California. They have been helping clients with home loans since 2003, and have Mortgage Banking and Mortgage Broker channels available to their clients to help with purchase, refinance, and reverse mortgages. The Mortgage Planners are affiliated with West Coast Mortgage, a local Direct Lender in San Diego for the past 15 years. The benefits of being a direct lender include controlling the loan documents and funding of the loan, more competitive interest rates and fees, and quicker underwriting time periods.
Home buyers needing expert mortgage assistance can contact The Mortgage Planners.