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U.S. Senator Dole Announces Legislation to Increase Home Ownership

Date: Feb. 3, 2005
Location: Washington, DC
Issues: Veterans


U.S. SENATOR DOLE ANNOUNCES LEGISLATION TO INCREASE HOME OWNERSHIP

February 3rd, 2005 - Washington, D.C. - U.S. Senator Elizabeth Dole (R-NC) is again co-sponsoring legislation that would make mortgage insurance tax deductible for families with income below $100,000 a year. This initiative will help make owning a home more affordable.

"Today's low interest rates in the mortgage market, coupled with this deduction, will benefit many Americans," Dole said. "It's an innovative way to help make the American dream of owning a home more affordable."

It is estimated that making mortgage insurance tax deductible will increase home ownership and help more than 12 million families by enabling them to deduct the costs of these payments on their federal income tax returns. Housing economist John Tuccillo has estimated that this initiative could turn more than 300,000 low- and moderate-income families into homeowners. Mortgage insurance is required whenever a down payment is less than 20 percent, a requirement that disproportionately affects middle and lower income households. The cost of mortgage insurance is in addition to the financing of the home, but unlike interest accrued on a home loan this payment is currently not tax deductible. The lack of tax deductibility has a disproportionate impact on those citizens who can least afford it. Consider these facts:

1) Nearly 1/3 of all home owners who pay mortgage insurance premiums on either Veterans Administration (VA), Federal Housing Administration (FHA), or private mortgage insurance companies (PMI) insured loans are non-white minorities;

2) More than 75% of these homeowners have a total household income of $75,000 or less; and

3) Over 80% hold modest mortgages of $175,000 or less.

"When families own a home, they not only take a step toward financial security through savings and investment, they also invest in their communities," said Senator Dole.

http://dole.senate.gov/index.cfm?FuseAction=PressReleases.Detail&PressRelease_id=357&Month=2&Year=2005

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