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Finance allah shmoop shmoop What is a mortgage Well people

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a mortgage is just dead it's alone but one with

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special tax treatment For most people simply put Any interest

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you pay on a mortgage to buy a home is

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tax deductible Morty morton's inputs down a hundred thousand bucks

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to buy a home that costs four hundred big ones

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his mortgages three hundred grand at five percent interest per

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year So that's fifteen thousand dollars a year he pays

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to rent the money from the bank which he uses

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to buy his dream home with the loop de loop

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waterslide Morty earns one hundred grand a year and pays

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tax on his last fifteen thousand of earnings soas faras

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The irs is concerned since morty can deduct his fifteen

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thousand dollars in interest against his earnings he does not

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in fact earn taxable wages of one hundred grand annually

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Instead he earns taxable wages of eighty five thousand dollars

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a year Essentially with government is doing is sharing in

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some of the cost of renting the money Taub i'm

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ortiz home well why would the u s government be

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so charitable Well because home ownership has been integral part

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of the american dream since the u s of a

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i po'ed in seventeen seventy six easy access to mortgages

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and then home buying can be a hugely beneficial asset

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In the vast majority of cases homes create family stability

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a store of wealth and tax dollars for local schools

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in the form of real estate taxes So don't feel

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bad about splurging on that water slide there Morty Just 00:01:42.93 --> [endTime] remember you're doing it for the kids Hello

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