[Rutles4Ever]

Gee, here's a radical idea - Why don't they subsidize the repeal of the AMT by cutting spending instead of punishing homeowners? I mean, WTF are these people thinking?

The problem is that this penalizes first time homebuyers out of the gate. Even those of us who live in modest homes will have their deduction reduced from 27% to 15%. For those of us in the early years of a 30-yr mortgage, only a sliver goes to paying down principle, and the tax refund goes a long way to cushioning the blow.

[Wurlitzer]

"The problem is that this penalizes first time homebuyers out of the gate. Even those of us who live in modest homes will have their deduction reduced from 27% to 15%. For those of us in the early years of a 30-yr mortgage, only a sliver goes to paying down principle, and the tax refund goes a long way to cushioning the blow."

May I suggest that income taxes should have never been used for social engineering. A tax deduction for doing something the government APPROVES of is insidious.

Yes, I own my house, and yes I have used the deduction because that is the way the game is played. It does not have to played that way nor, IMO, should it.

Tax for the legitimate functions of the government (as the Founding Fathers instructed) and leave the social engineering to the Church.

[Senator Bedfellow]

The problem is that this penalizes first time homebuyers out of the gate.

Actually, it's quite good for first-time homebuyers, because it means an instant reduction in housing prices right out of the gate - as long as you're still shopping, that is.

[steve-b]

WTF are these people thinking?

If Michael Moore planted a mind control device into their brains and instructed them to behave in a manner designed to convince the voters that Republicans want to grind the middle class into the dirt so that the rich can hire servants cheap, there would be no way to tell the difference.

[InsureAmerica]

""Even those of us who live in modest homes will have their deduction reduced from 27% to 15%.""

This is the problem and what people knee-jerk react to without understanding. This is NOT 27% to 15%. It is eliminating the ability to recude your income by the amount of mortgage interest and adding the ability to reduce the amount of tax you owe by 15% of your interest paid. The 15% is a CREDIT. People will never get this. This is what will doom the effort. You must run your own numbers to see if you will pay more or less.....

[Glenn]

and the tax refund goes a long way to cushioning the blow.

A refund is the return of money to you that the government held in anticipation of your tax obligation for a year.

Part II: Most people take the tax impact into account when deciding whether to take on a particular mortgage. If the government changes the rules, then it has to do it carefully.