Hawaii Gives Higher Mortgage Tax Credits

The continuing effort to make real estate affordable is making some progress in the island state of Hawaii. Homeowners there face some of the most expensive real estate in the nation while also having to bear high home insurance prices. The state government elected to give homeowners double the mortgage tax credit when compared to the last few years. The credit was available to homeowners in Hawaii since 1989, but 2007 will bring about a much higher incentive to utilize the funds.

The credit allows homeowners to claim a federal tax reduction equal to 20% of their mortgages’ interest. On the average Hawaii home loan, this could be a yearly savings of more than $6000 to claim on tax returns. The typical itemized deduction for mortgage interest can still be applied to the other 80% of the interest paid. The credit is available to anyone purchasing a primary home in the state that has not held rights to property in the last three years. Homeowners looking to cash in on the credit when refinancing are not eligible. \r\n