Update: Mortgage Insurance Deduction: Universe of Annual Insured Loans in 2 Million Range.

My earlier post took Senator Smith to task for claiming that 12 million families benefitted in the first year when the mortgage deduction was available. One thing that may not be clear to all is that only those filers who take out NEW loans during an eligible period AND use mortgage insurance are eligible to claim the deduction. So I went back and did some research on annual mortgage insurance volume:

1. Private mortgage insurance companies have done about 2 million loans in the last 12 months (PMI data is HERE).
2. FHA and VA in 2006 did about 600,000 loans
   
3. Even if FHA/VA/RD loan volume picked up to 1 million a year, the total volume of PMI and Government Insured loans would likely be in the 3 million range.

Actual annual USERS of the deduction however would be substantially less than that 3 Million as a significant percentage of filers do not claim itemized deductions.

My current expectation is that users of mortgage insurance who got their mortgage insurance in one [qualified] year could continue to claim the deduction for any and all years where the deduction was available, currently 2007-2010. Therefore, if 1.5 million users annually were eligible AND used the deduction each year , and continued to do so, by the end of 2010 there would be a total of 6 million users of the deduction.