Question

Both the principal portion and interest portion of your mortgage payments are deductible from your income for Federal Tax calculations. True or False

If you are unable to continue keeping your mortgage current and anticipate default you may be able to work with your lender to execute a short sale of your home. In this case you would sell your home and use the proceeds to pay-off the balance of your mortgage. If you owe more than the balance of your mortgage a short sale can protect your credit rating. The short sale gives you an exit strategy that has been negotiated with the lender rather than forced on you by the lender. True or False

Buying a home requires that the buyer has funds available for the down payment, mortgage application fees, the closing costs of the transaction, insurance premiums, and property appraisal. True or False

Answer 1

1. False, the interest payments are deductible fro the federal tax calculations but the principal amount is not deductible.

2. True. Short Sale provide an exit strategy for the home owners if there aren't catching up with the interest payments for long. The lender is incurring loss on the house and therefore short sale can be negotiated with the home owners.

3. True. Buying a home on Mortgage requires down payment, mortgage fees , closing costs of transactions, insurance premiums and property appraisal costs.