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In your opinion, do mortgage interest deductions help the Huntington Beach housing market?

Asked by Trulia Huntington Beach, Huntington Beach, CA Fri May 17, 2013

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Without a doubt, the mortgage interest deduction helps the Huntington Beach housing market.


James Melton, top 5% of all Realtors (source Trulia 2013)
Realtor & Mortgage Broker, CA DRE Broker #01222353, NMLS #300133
President, Victory Mortgage & Real Estate Home Loans & Sales Since 1979, NMLS #366399
2901 W. PCH, Suite 200, Newport Beach, CA 92663
cell(714)318-4664, phone(949)939-9676 or (714)374-0022, fax(714)844-9094
0 votes Thank Flag Link Fri May 17, 2013
Without a doubt, mortgage interest rate deductions make homeownership more affordable and beneficial in all real estate markets and this has been a staple for the past 100 years.
0 votes Thank Flag Link Fri May 17, 2013
Mortgage interest deductions help any housing market. The ability to reduce your taxable income, thereby reducing the amount of state and federal taxes you pay, puts more money in your pocket. This not only helps the housing market by increasing the amount you can afford to pay for a home but the economy in general by increasing the amount of money that is poured back into the economy using the multiplier - every dollar spent in the economy is multiplied in the form of dividends to investors, salary for the producers and merchant employees, reinvestment in more stock and equipment, etc.

The availability of the mortgage interest deduction makes it possible for taxpayers to itemize other deductions (property taxes, state income taxes, medical expenses, etc.) for which it would not make sense for the taxpayer to deduct when compared to the standard deduction.

However, should one of my clients be in a position to pay off their mortgage and asks me for my opinion on whether or not it makes sense to continue using the mortgage interest deduction or pay off the mortgage, I will almost always suggest they pay off their mortgage. To use a simple mathematical equation, if you are in the 30% tax bracket and can deduct $10,000 in mortgage interest, you are saving $3,000 in taxes. To put that into perspective, you are paying your lender $7,000. If you pay off your mortgage, you are no longer paying the $10,000 in interest but will be paying the $3,000 in taxes. Therefore, you will be saving the $7,000 difference between interest payments and "saved" taxes.

Tim Kunze, Realtor®
Focusing on ... YOU!!!
714-552-2335 (cell)
Lic #01488712
Web Reference:
0 votes Thank Flag Link Fri May 17, 2013
Mortgage deductions that are allowed by the IRS and state of California help borrowers pay less taxes. Less taxes allows borrowers to have more money to spend on any things including their mortgage payments. Huntington Beach as well as other cities across the U. S. benefit.
0 votes Thank Flag Link Fri May 17, 2013
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