Home Mortgage Interest Deductions To Be Reduced
Obama vs. real estate
With “hope and change,” Obama is whipping out new programs, rescue packages, bailouts, etc. Unquestionably, he thinks all these expenditures will produce a healthier economy or at least provide help where needed. Huge budget deficits are burgeoning and the Obama administration is forced to seek new revenue sources. Obama’s current budget will reduce home mortgage interest deductions and funnel money towards helping these building deficits.
The initial steps will affect the higher earners, but once the door is open, what will stop the earning caps from being reduced until the final elimination? Am I stretching the truth on this topic?
The idea that elimination of the home mortgage deduction will not affect home ownership is already being discussed. Those in favor of reducing/removing the home mortgage deduction mention the fact that Canada, the United Kingdom and Australia do not provide mortgage interest rate deductions but still have roughly similar homeownership rates as the United States. Another added perk is the advancement of Obama’s stated goal for wealth re-distribution. Read more 
Federal Housing Administration (FHA) In Trouble
FHA home mortgage defaults
With recent reports that 20% of mortgages guaranteed by the Federal Housing Administration (FHA) in 2007 and 2008 are defaulting, it appears that the corner of the carpet that things are being swept under might have changed but that the sweeping is still going on. Proof that lessons were not learned is shown by similar default rates for the period of 2005-2006 (20%) when the bubble seemed to have gained its own inertia and was sucking mortgages in instead of having to have them pumped out.
In addition to the losses tied to the eventual defaults on the mortgages it guaranteed, the FHA is also suffering from mortgages it invested in. Write downs on $1.04BN in the value of private-label MBS, the kind not backed by any GSE, resulted in the booking of a $165MM loss on these types of securities by the FHA in 3Q09; a veritable one-two punch that will, once again, have the taxpayer being dragged from the ring.
Sorrento Valley real estate agent