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Mortgage Interest Deduction

Making more than $40K per year would be a good start. And then, spending about $1K less per month will geet you there quick.
I dont know that Id call 100 months "quick". Nor that spending $12k less per year is an option for someone already spending only about $35k. ($40k after taxes)

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I dont know that Id call 100 months "quick". Nor that spending $12k less per year is an option for someone already spending only about $35k. ($40k after taxes)

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lol...it starts by buying your first house on credit, paying a few extra bucks every month and adding some elbow grease to build equity, then selling it at a profit. Next, you buy another house but with more money down. As a result, you end up with a lower monthly payment. Again, instead of pissing away the extra money, you plow it back into the house by making extra payments. Rinse, repeat.

Before long, you're sitting on that 100-G's of equity and you can buy that next house in cash by kicking in a few bucks from an investment account. Point is, why do that if interest rates are at 4% and the mortgage deduction drops it to an effective out of pocket below 3%? Betetr off keeping the money in investments, most of which yield 5 to 8%.
 
Yes "the dude" does have more money left in his pocket - rental of the same size home would be more expensive and his taxation would remain higher. Add to that the likely appreciation of the property (plus added equity) and not only did "the dude's" disposable income increase so did "the dude's" net worth.

You are talking about the benefits of home ownership - not the mortgage industry subsidy that I was describing.

Mortgage interest deduction can still go away in my book.
 
You are talking about the benefits of home ownership - not the mortgage industry subsidy that I was describing.

Mortgage interest deduction can still go away in my book.

Exactly, but many were trying to say that home ownership was only possible because of the special federal income treatment that it receives. Each and every special tax perk (deduction, credit, exclusion or special accounting method) has folks that benefit from it that will (try to) defend it as necessary to the economy.

One of the biggest examples of of an industry subsidy provided by the federal incone tax code is medical care insurance. Employers pay money to insurance companies, on behalf of and to directly benefit their individual employees, yet that does not count as employee income - this is not (yet?) allowed for other forms of direct employee benefit, or example, an employer can't pay an employee's mortgage, auto insurance or utilities on their behalf and thus have that portion of employee compensation (direct labor cost written off by the empoyer) no longer be considered as taxable income to the employee.
 
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