In an appearance on MSNBC on December 16, 2012, National Low Income Housing Coalition (NLIHC) President and CEO Sheila Crowley described the ongoing shortage of housing affordable to the lowest income Americans and the Coalition’s proposal to reform the mortgage interest deduction and use the savings to fund the National Housing Trust Fund.
The discussion was part of a conversation about fair housing, foreclosure and housing affordability for Americans in poverty.
Click here to learn more about NLIHC’s MID reform proposal.
Click here to view a list of endorsers of the proposal and click here to sign on to endorse the proposal.
Arguing for funding for the National Housing Trust Fund, Ms. Crowley explained that there is a 5 million-unit shortage of rental homes affordable to the lowest income renters.
This is one of the main causes of homelessness, and Ms. Crowley explained that capitalizing the National Housing Trust Fund at $30 billion a year for ten years could end homelessness in America. The other panelists were in agreement that funding should be found for the National Housing Trust Fund.
The National Low Income Housing Coalition proposes to modify the mortgage interest deduction (MID) by reducing the size of a mortgage eligible for a tax break to $500,000, and to convert the deduction to a 15-20% non-refundable tax credit.
This proposal to modify the mortgage interest deduction into a tax credit will save the federal government between $20 billion and $40 billion a year while making this tax benefit more available to the middle and lower income families who need it. Homeowners would receive a 15-20% non-refundable credit for interest on mortgages up to $500,000. Interest on second homes and home equity loans would be eligible for credit under the $500,000 cap.
NLIHC continues to gather support for this proposal. As of this writing, 579 organizations, including Monarch Housing Associates, have signed on to endorse the proposal. Endorsers include 48 national organizations and 531 state and local organizations, and represent all 50 states, Puerto Rico and the District of Columbia.