Compared to other financing options, a mortgage loan with PrivateMI is often more affordable and its fixed, predictable premiums provide consumers with peace of mind -- and now a tax deduction. And PrivateMI is cancelable once the homeowner has built up enough equity in the home.

Private mortgage insurance premium prices vary based on the size of the down payment, type of mortgage and amount of insurance coverage. The cost of PrivateMI for a median-priced home -- the projected national median price in 2007 for a single family home is $224,500 -- ranges from $50 to $100 per month.

“This new tax deduction will make loans with private mortgage insurance even more attractive for home buyers who are on the cusp of homeownership,” says Suzanne Hutchinson, MICA’s executive vice president. “The wide-ranging group of organizations that support this important tax break will certainly be working to extend the deduction beyond 2007.”

Consumer groups have had high praise for the new law.

“Homeownership contributes substantially to social stability,” says Bruce Hahn, president and CEO of the American Homeowners Grassroots Alliance. “Yet homeownership remains just beyond the grasp of millions of Americans. Making the cost of mortgage insurance tax deductible helps put homeownership within reach for many more families.”

Tax day in April 2008 -- when taxes are filed for 2007 -- could bring new benefits to qualified home buyers who will buy or refinance homes this year with tax deductible private mortgage insurance.

“This tax deduction will create important social benefits by offering relief to over-burdened taxpayers,” says John Berthoud, president of the National Taxpayers Union. “Finally, homeowners will have the ability to make all the costs associated with the ongoing financing of their home truly tax deductible.”

Advocates for African American and Hispanic groups also note the benefits of the new tax break.

“A tax deduction for mortgage insurance premiums will go a long way to help homeowners and potential homeowners who simply want to own a piece of the American dream,” says Marc H. Morial, president and chief executive officer of the National Urban League. “I congratulate both the U.S. House and the Senate for doing what’s right to make the goal of affordable homeownership a reality for every American.”

“Currently, many Latinos need loans with private mortgage insurance because they are unable to afford the 20 percent down payment traditionally needed to buy a home,” says Guarione M. Diaz, president and CEO of the Cuban American National Council. “Policies such as this one help these families realize the aspiration of homeownership and fulfill an essential element of the American dream.”

“With a U.S. Hispanic homeownership rate of 48 percent (20 points below the national average of 68 percent), this legislation would enable more hardworking Hispanic families and consumers to become homeowners,” says Manny Mirabal, president and CEO of the National Puerto Rican Coalition. “An estimated 33 percent of the families benefiting from this tax deduction would be minority homeowners.”

Courtesy of ARAcontent