WASHINGTON –– U.S. Rep. Frank A. LoBiondo (R-2nd) was one of 165 GOP members in the House to support the Mortgage Forgiveness Debt Relief Act of 2007 (H.R. 3648), a measure meant to help address the ongoing turmoil in the housing and lending markets.
The popular bill passed 386 – 27 with overwhelming bipartisan support. Similar legislation is pending before the U.S. Senate.
According to a release from the House Ways and Means Committee, “Under current law, debt forgiven following mortgage foreclosure or renegotiation is considered income for tax purposes, resulting in tax liability for individuals and families.”
This bill would provide tax relief to families by permanently excluding debt forgiven under these circumstances from tax liability.
The release noted that an estimated 2 million American families could lose their homes to foreclosure due to rising interest rates in the current housing market crisis.
“I am happy that Congress came together to give bipartisan support for this common sense bill to help alleviate the pressure American families are feeling due to the subprime mortgage crisis,” said Ways and Means Committee Chairman New York Rep. Charles B. Rangel (D-15th), who wrote and sponsored the bill.
“It is just not right or fair that families struggling through a foreclosure would then face a tax bill in addition to losing their homes when they have seen no increase in their net worth. This bill rights that wrong and provides tax relief to millions of American families.”
The measure would also allow homeowners who purchase mortgage insurance between Jan. 1, 2007 and Dec. 31, 2014 to deduct premiums from their income when they file their taxes, according to a release from Michigan Rep. Sandy Levin (D-12th).
“Mortgage insurance allows aspiring homeowners to take out safe, stable mortgages with lower down payments and provide an attractive alternative to so-called ‘piggyback’ loans. It levels the playing field among different mortgage options,” said Levin.
“Making mortgage insurance more affordable will help millions of families afford the American dream of homeownership.”
Contact Hart at (609) 886-8600 Ext 35 or at: jhart@cmcherald.com
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