Mortgage Interest Rebate Accounts (MIRA)

by 14 Sep 2012

Giving Homeowners a Leg to Stand On


Millions of Americans have gone broke by buying their dream home, and now financial innovation is needed to help savers and mortgage holders get out of debt. Wall Street and Congress have too much power – and they’re using it to keep corrupt individuals from going to jail. It's payback time.

I would like to discuss my idea for the creation of what I’m calling Mortgage Interest Rebate Accounts. It is time to take back the American home-ownership dream from the current “Wall Street-Super Congress World” scam. Banks have become fee-collecting machines. This is how they make their record profits.

So how do we create a strong banking system to help the rest of us – the savers and borrowers? The answer is to allow homeowners to have Mortgage Interest Rebate Accounts. This concept would have banks rebating 50% of all interest back to the borrower. It is a 50/50 split between the borrower and bank so the banks are paying interest to their borrowers as well. A key part of this concept is that the mortgage borrower gains access to the rebate money only after the mortgage is paid off.

Also, the Interest Rebate Accounts will earn no interest for the mortgage holder. The bank will be allowed to keep all interest it earns on Interest Rebate Account balances. The biggest hurdle will be that mortgage interest will no longer be tax deductible. Going into debt should not be encouraged by our corrupt political system. With this plan in place, borrowers will have an incentive to never miss a mortgage payment. If they don't make a payment, they would lose all money in the Interest Rebate Account. For example, let’s say you paid $12,000 in mortgage interest last year.

Imagine if half of this were rebated back to you. This $6,000 would add up to $60,000 in 10 years. Interest Rebates are a way to strengthen the middle class. This would bring enormous economic change by empowering consumers with cash. Right about now, you may be thinking: why would banks want to offer Interest Rebates? We all know they only want to charge outrageous transaction fees. The answer is that the banks can also charge a fee for the Interest Rebate Account. They would also be able to attract investors and savers to make deposits into their bank by paying them interest. They can still focus on quarterly profits from their ridiculous transaction fees.

Those of us who choose to be responsible and save can no longer be ignored, especially the retirees who need the interest to survive. Here is another example of how this would work. Let's say a mortgage has a 4% interest rate. Two percent of the interest would be deposited into an Interest Rebate Account and the other 2% would be deposited into an interest-bearing bank account. Say your mortgage payment is $1,100. For simplicity, we can say $100 of this payment goes to principal and $1,000 is interest. The bank would rebate $500 in interest and pay savers $500 in interest. The bank will keep all interest earned on Interest Rebate Accounts. The end result is that savers receive interest, mortgage holders become savers, and banks lend money and pay interest.

Aligning the best interest of savers with quarterly bank profits is vital to changing our broken system. Providing the same income stream to savers and banks culminates in the idea of Mortgage Interest Rebate Accounts. When you consider that banks get their money for free from the Federal Reserve, Interest Rebates work! Banks need to start working for honest hard-working Americans. When banks get money for free, it is only right for our interest payments to be rebated to us. In a financial market that mandates pretend rules, Mortgage Interest Rebate Accounts are one way we can fix our broken banking system.

Harry Brokass (A.K.A. Eric Thomas), besides being a fictional character in his own book, is a Certified Public Accountant who played by the rules and did everything right when he bought a home. Unfortunately, like many other Americans, playing by the rules just wasn’t enough and now he is a homeowner whose mortgage is twice the value of his home. This experience was the catalyst for Capitaol: Buying Our Democracy with Stolen Money, his attempt to even the playing field against Wall Street and “Super Congress World.” Capitaol: Buying Our Democracy with Stolen Money can be purchased at www.Amazon.com

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