By Chris Whalen, CPA ~
We have seen an uptick in mortgage rates and this has people believing they can afford less of a house.
This is quite often untrue, as the tax savings from the new tax reform bill could offset the increase in your monthly mortgage bill, even in situations where your itemized deductions are limited.
This hysteria is similar to that of the SALT (State and Local Tax Deduction) limitations we have been hearing so much about.
The current dogma about SALT says:
“NJ HOME PRICES WILL PLUMMET!”
“IT IS NO LONGER WORTHWHILE BUYING A HOME, STAY RENTING!”
You will notice that these supposed news articles NEVER have any detailed analysis or case studies to back them up.
I have over 100 case studies and actual returns that show me the vast majority of taxpayers will have more after tax income in 2018 than 2017, even those whose itemized deductions are limited.
Now we have the media spreading similar fears about the increase in mortgage rates.
The truth is we can know how much house you can afford. We run detailed tax projections everyday that are used by underwriters to approve loans.
Many taxpayers’ after tax income will be HIGHER in 2018, and therefore they can afford MORE of a house, even considering an increase in mortgage rates.
But, you don’t need to guess. Call me to prepare a detailed projection customized for you and your family.
At Chris Whalen, CPA we do not guess. Please reach out to me without hesitation with any tax, business or accounting question, and to schedule a consultation. (732) 673-0510