Mortgage tax proposal peeves professionals

by Justin da Rosa01 Nov 2017
The Republican party’s about-face on a tax proposal -- which is said to strip many Americans of their ability to claim mortgage interest deductions -- is stirring up controversy among Mortgage Professionals America’s readership.

“If the Republican party goes through with dropping the tax and interest credit for homeowners it will absolutely cripple the home industry, including builders, mortgage lenders, realtors and every phase of the market that is tied to the home industry. Even congress can't be this blindly stupid,” one reader, who goes by the moniker ‘Fed up in Florida,’ wrote in the MPA forum. “I'm a 43 year mortgage professional and cannot image that my party would even consider such an asinine move. If they pass anything that impacts the benefit of home ownership I will drop out of my lifelong republican party membership.”

The comment was in response to the Republican Party’s mortgage tax proposal, which removed a popular interest rate deduction.

Readers join the National Association of Home Builders' criticism of the party's propsed tax bill.

Earlier this week, the NAHB accused House Speaker Paul Ryan of reneging on an original proposal that would have included the homeownership tax credit that would have benefited tens of millions of American households.

NAHB said it had been working with leaders of the House Ways and Means Committee on a tax incentive that would boost the middle class. As of last week, NAHB believed the proposal was a done deal.

However, it was recently told by the House leadership that the credit will be removed from the bill.

"By sharply reducing the number of taxpayers who would itemize, what's left is a tax bill that essentially eviscerates the mortgage interest deduction and strips the tax code of its most vital homeownership tax benefit,” Granger MacDonald, chairman of the National Association of Home Builders (NAHB) and a home builder and developer from Kerrville, Texas said in a statement Monday. “This tax blueprint will harm home values, act as a tax on existing home owners and force many younger, aspiring home buyers out of the market.”

And it seems many originators agree with NAHB.

“After 40 years in the mortgage industry watching one after another Washington driven legislative fiascos that have placed many burdens on homeownership, I really never thought I'd see congress step this low on something this important or consider backtracking on a promise this important and as a lifelong Republican all I can do today is sit in disbelief,” another reader wrote. “These people don't have a clue as to what this can do to the main route to middle class wealth building.”


Related stories:
NAHB reconsiders housing tax policy
Industry group slams tax plan over mortgage deduction
 

COMMENTS

  • by Ramirez | 11/1/2017 11:19:57 AM

    I have been in the real estate lending business for 30+ years and find this latest news from Congress extremely disturbing. The economy is on a slow trickle to improvement and removing the home mortgage tax deduction will cripple this industry and in turn the economy. Congress is so completely out of touch with what's going on with the average American. They all need to be fired and sent home packing. They only look out for their own interests and lining their own pockets. It doesn't seem to matter which political party is involved, all they do is fight and get nothing done...or what they do end up getting done - they don't read the laws they pass. The pass and read later way of doing business must stop. If businesses were run the way Congress acts, we would all be bankrupt and in jail.

  • by Joe Rowan | 11/1/2017 11:38:41 AM

    RINO.

    Let me get this straight, supposed fiscal conservatives expecting a light governmental touch (which intones a desire for government to lift it's thumb of the economic scale, cease the practice of picking winners and losers, etc.) are outraged tax policy reform would even partially remove a HUGE impediment to both free markets and housing affordability?? Since when does the desire acquire to stable shelter in locations that best suit our financial ability, lifestyle and self-pride require contrived fiscal stimulus?

    I suppose this same legion of apoplectic mortgage and housing professionals char at the folly of ethanol subsidies, Elon Musk-breaks and social welfare. How handy to suggest mortgage interest, property tax and depreciation (for investment property) deductions are NOT forms of welfare. Conveniently overlooked is the fact roughly 70% of all homeowners elect to claim the standard deduction instead of these tax give-aways. So whittling down the 30% of households that claim the deduction will devastate the housing industry? Not by a long-shot! It's simply a talking point many of my colleagues in this business propagate for their own benefit.

    There appears an abundance of self-serving buffoons in the GOP these days. Losing a few more sounds positively refreshing!

  • by Jase Stefanski | 11/1/2017 12:59:11 PM

    I have been doing home mortgages since 1993 and can't agree more. Time to get the government out of encouragment of debt.

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