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beb86
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Registered: ‎10-31-2011
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Re: FHA Rules to change around March 31st on Mortgage Insurance!


Mike_B03 wrote:

MovingForward_2012 wrote:
Right but rates will be going up so refinancing won't be as attractive and may not save any money. If you read the article closely it said that the new rules will go into effect shortly after the announcement on or before March 31st. So it is best to get in now if you can.

What happens to people who are in the process but can't close yet since it's a new build? I hope we can be grandfathered in if there is a change because it would be BS otherwise.


I would assume as long as you had a case number with FHA (under contract) by the deadline you should be fine. Thats how we got out of paying the upped FHA fees last year.

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MovingForward_2012
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Re: FHA Rules to change around March 31st on Mortgage Insurance!

The $3600 back is what my broker estimated from writing off the interest and property taxes at tax time. We are buying a $347,900 home so the write off amount is quite substantial. The $3600 doesn't take into account the mortgage insurance that is now deductible again so I will get more than $3600. Our property taxes are $3100 a year...not a trivial amount there either. So I'm looking forward to April 15, 2014. LOL! This is the nice part about owning a home...itemized deductions!
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MovingForward_2012
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Re: FHA Rules to change around March 31st on Mortgage Insurance!

Oh and the article does say that those who are already owning a home or in the process of owning with an FHA loan, they will be exempt from the new rules. At what point in the process, not sure but I assume if you sign the contract before the new rules are in place, you're exempt. I'm sure the govt will clarify more at a later date.
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Mike_B03
Posts: 1,146
Registered: ‎11-30-2012
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Re: FHA Rules to change around March 31st on Mortgage Insurance!


MovingForward_2012 wrote:
The $3600 back is what my broker estimated from writing off the interest and property taxes at tax time. We are buying a $347,900 home so the write off amount is quite substantial. The $3600 doesn't take into account the mortgage insurance that is now deductible again so I will get more than $3600. Our property taxes are $3100 a year...not a trivial amount there either. So I'm looking forward to April 15, 2014. LOL! This is the nice part about owning a home...itemized deductions!

Those aren't tax credits though, are they? Don't they just reduce the amount of money you are taxes on (tax deduction)? Also, you need to itieize deductions in order to claim it right? Maybe with a home it will be different but we've always taken the standard deduction.

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MovingForward_2012
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Re: FHA Rules to change around March 31st on Mortgage Insurance!

You have to itemize and only when you own a home does the itemized deductions exceed the standard deduction unless you have a lot of investments.
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MovingForward_2012
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Re: FHA Rules to change around March 31st on Mortgage Insurance!

I think the mortgage insurance is a tax credit but interest and prop taxes should be itemized.
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jwpezd
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Registered: ‎04-06-2012
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Re: FHA Rules to change around March 31st on Mortgage Insurance!

When is this going in to effect I'm confused is it in match or not?
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MovingForward_2012
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Re: FHA Rules to change around March 31st on Mortgage Insurance!

You can claim the mortgage insurance tax credit on your 2012 tax return. Itemizing interest and property taxes have been in effect for decades for homeowners.
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ficogirl1
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Registered: ‎01-23-2012
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Re: FHA Rules to change around March 31st on Mortgage Insurance!

Just to clarify, there is no mortgage insurance tax credit for the 2012 tax year.  The mortgage insurance, just like mortgage interest and property taxes, can be deducted as an itemized dedcution for the 2012 tax year.  The amount of the deduction that you may be entitled to will vary for each individual person and the exact amount will be determined when you file your income tax return.

 

The amount of a tax deduction determined by a realtor, and not a tax professional, should be taken with a grain of salt.  In addition, you must be careful to not determine your  affordability of a mortgage payment on a tax deduction, because there is a possiblilty that the deduction may not be available in the future.


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Valued Contributor
MovingForward_2012
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Re: FHA Rules to change around March 31st on Mortgage Insurance!

I disagree with that. You are also going to pay the same amount of interest every year on a home if you have a 30 yr fixed. That amount of interest will always be an itemized deduction on your taxes. Your loan amount, interest rate, and loan term will vary your taxes paid. Own a bigger house, pay more interest on larger principal, and get more back each the master plan. Going after mortgage interest and tax deductions, was discussed during the election season as the govt was talking about on one side, that there aren't enough deductions that affect just the wealthy to see a significant amount of revenue. And so they knew to see a big of revenue, they would have to slash the mortgage interest deduction when instead tax rates on folks making $400,000 or more was implemented.

So no one is saying count on it but people have been getting substantial IRS refunds based on their itemized mortgage deductions for decades. And no one said go find a home you can't afford; you have to be able to afford it on day #1 but other leisurely items may be something to look forward to given the extra money back from the IRS each year.
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