Posted: Oct 13, 2005 By: Lynda K. Bloom, e-PRO

Subject: Home Interest Deduction

Comment: I have been an active real estate agent in Montgomery County, Maryland for the past 15 years and over those years a large percentage of my business has been helping first time buyers purchase a home.

I would like to point out to the committee that the home interest deduction in a HUGE part of the reason most first time buyers can buy. In broad a generalization, a mortgage payment is 1//3 higher than the rent first time buyers are making. Most first time buyers can make sacrifices to spend more for a home versus a rental but not 33% more! The tax deduction compensates for a large portion of that increase in the first few years of the mortgage life due to the amortization.

As much a many people have the desire to own a home, it has to be economically viable and without the tax deduction I don't see how that would be possible for first time buyers.

As a side note, I would like to mention that having worked with clients over decades, I have seen the equity they had built in a property help them through some rough times later on in life such as health problems, temporary loss of employment, divorce, etc. I think you should consider the long term impact on society as a whole if you eliminate the tool that allows first time buyers to purchase and also to build a financial safety net for issues that arise later in life.

Thank you for your consideration.

Lynda K. Bloom, e-PRO