Tax Bill Boon To MI Industry?
The passage of a bill that makes mortgage insurance premiums tax deductible is one more factor that improves the outlook for mortgage insurance stocks, according to analysts at Friedman Billings Ramsey.
Just before adjourning last year, Congress passed a tax bill that includes the MI deduction, which had been on the industry's wish list for years. The MI deduction is limited to homebuyers with less than $110,000 in annual income.
The deduction applies to homebuyers financing a purchase with private mortgage insurance as well as those using Federal Housing Administration or Department of Veterans Affairs guaranteed financing.
FBR's Paul Miller, Steve Stelmach and Annett Franke said in a report that the legislation should benefit MI penetration rates in the marketplace, which have already benefited from the decline in popularity of "piggyback" loans. (c) 2007 Mortgage Servicing News and SourceMedia, Inc. All Rights Reserved. http://www.mortgageservicingnews.com http://www.sourcemedia.com