MBA: This is No Time to Cap the MI Deduction

The Mortgage Bankers Association is adamantly opposed to the federal government capping the mortgage interest deduction as well as deductions for mortgage insurance payments and real estate taxes. MBA was reacting to an early read of President Obama's first budget which moves to cap itemized deductions for taxpayers who earn $250,000 a year or more. MBA believes that such a cap, if approved, would affect not only mortgage interest payments but also other itemized deductions. "We do not like a cap of any sort," said Josh Denney, vice president of public policy for MBA. "It would have an adverse impact on a market that's already in trouble." The Obama administration estimates that the deficit for fiscal year 2009 will reach $1.75 trillion, or 12.3% of U.S. gross domestic product. The deficit would be a record in dollar terms and is the highest as a share of GDP since the 1940s.