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When
you rent there isn't a tax break. When you own your home two things are
deductible: interest and taxes. So, two examples...
Example
#1
Loan
amount of $100,000 at 8%
$734 principle and interest
$ 75 taxes
$ 38 insurance
$847 total payment
$775 is deductible per month
$9300 total tax deduction per year
probably in this income range a 26% tax rate
$2418 tax reduction per year or $202 per month reduction
so your net payment is $645 per month
Example
#2
Loan
amount of $150,000 at 8%
$1100 principle and interest
$ 100 taxes
$ 45 insurance
$1245 total payment
$1,150 is deductible per month
$13,800 total tax deduction also 26% tax rate
$3,588 tax reduction per year or $299 per month reduction
So your net payment is $946 per month
The case studies
below are actual mortgage or real estate applications successfully processed
to completion, they are intended for the purpose of providing an
example only, and every mortgage application is underwritten
separately on its own merits.
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