US Senate has taken a great step recently by approving the Mortgage Tax Relief. Thousands of American families are facing financial problems due to the sub prime mortgage crisis. In this financial crisis, the homeowners first default and then lose their dream home. They even try to reduce their debt by working out with the lenders but then hit with huge tax bills due to the forgiven debt. So the US Senate has outstretched their helping hand by relieving them from at least the mortgage taxes.

If a lender forgives the debt of a home-owner, the forgiven debt is usually considered as income of the homeowner and he has to pay tax on that forgiven debt. But now the homeowners need not to pay tax on that forgiven debt as the Senate has approved the Mortgage Tax Relief bill. The bill also extends a provision allowing the homeowners to deduct mortgage insurance payments from their taxable income.

The U.S. Senate approved a bill on Friday, 14th December 2007, in order to make it easier for thousands of homeowners with inflated interest rates to refinance into federally insured loans and help them save their home from foreclosure.

About 2 – 2.5 million adjustable rate mortgages are scheduled for a reset in the coming year and many borrowers might even lose their homes due to the high interest rates. The Senate’s proposed plan will be a blessing for these “distressed homeowners”.

Under this Senate bill, the down payment required for FHA loans will be lowered down to 1.5% from the current 3%. It will also raise the maximum mortgage amount that FHA can insure in high housing cost areas like California from the current $ 362,790 to $ 417,000.

The economic fallout as a result of increasing foreclosures has been a concern for most of the political leaders and the Senate vote supporting this bill was a reflection of this concern. In spite of several oppositions, the bill was approved with an ultimate aim to improve the present economic scenario. This is truly one of the best Christmas gifts for all the homeowners.

I was just wondering when going through the articles on various financial issues written by Robert. Basically he is a well-known professional in the matters concerning investors. Mr. Valentine currently lives in Huntington Beach, California. His articles on financial planning matters that concern investors have been published by several publications throughout the United States.

His specialized fields:

• Share information on wealth accumulation and preservation
• Assist investors age 60+ with strategies designed to preserve their capital, increase their income and more profitably organize their investments
• Focus on helping pre-retirees and retirees avoid the most common financial mistakes
• Insurance care

Apart from that, he has developed an ‘Essential Retirement Tool’, Federal Income Tax helpline with the complete schedule. Simultaneously maintains a Glossary of financial terms.

“The Mortgage Insiders” is maintained by Rob and Terry, who are 15 year veterans of the mortgage industry. Terri Ewing, and Robb K. Blake are dedicated to restoring the integrity of the mortgage industry through educating both mortgage consumers and mortgage providers about the ethical way to buy and sell home loans.

Robb has written few books on mortgage shopping, foreclosure etc. The book named “No cost mortgage software” attracted me very much. According to Robb, The New Mortgage Insider’s Software Turns Your Mortgage Into a “No Closing Cost” Mortgage Without Refinancing… 100% Guaranteed!

Other good books written by Robb:

1. The B.U.IL.D. Mortgage shopping system
2. The Home Custody Book
3. The No Cost Mortgage
4. The Stop your foreclosure now

Some important topics they cover:

1. Mortgage Rates
2. Mortgage Frauds
3. Mortgage Insurance
4. Yield Spread Premium

The mortgage industry has a lot to offer in terms of financing options, special programs for first time buyers and down payment assistance. But borrowers are often confused when it comes to choosing the right mortgage for their needs.

There are financial tools using which borrowers can calculate and compare payments before deciding to opt for a loan program. Even then, they fail to figure out which is the right offer for them. Often they are lured by the low initial rate charged by an ARM and then when it resets, they’re simply not prepared to cope up with rising payments. That’s when they decide to refinance again to an ARM or most often to a long term FRM.

What I find is, most people can hardly decide between an FRM and an ARM. They are confused as to whether they’ll go for 30 year fixed rate mortgage or opt for a 5/1 year ARM. To help borrowers decide between an FRM and ARM, Rick Pelleriti, our community member and a mortgage planner and real estate broker, has come up with a white paper consisting of simple calculations on which is better – taking a 30 year FRM or a 5/1 year ARM and then refinancing it almost 6 times.

Have a look at the white paper and you’ll come to know simple calculations that can make a difference in your decision and hence give you financial peace and happiness.

[tags]30 year frm, 5 year arm, frm vs arm[/tags]

Staci Carsten, a real estate professional maintains this blog. He picked up some of the very relevant and useful topics on mortgage & real estate and covered it in the most convenient way. Some of the topics are based on:

Mortgage frauds, Ways to purchase property, foreclosures, tax issues, debt consolidation etc.

Blogger originates from Portland, Origon and started blogging since March 2007. Staci loves to educate young people about personal finance. I think the mortgage community will find this very blog useful.