How stressful are Housing Loans for Americans? How many years on average can the average working person pay off their Housing Loans?

In fact, U.S. policy is very favorable for the average person to purchase a home. First of all, the mortgage interest rate is low, much lower than the interest rate of ordinary commercial loans and credit cards (of course, one of the reasons is the value and appreciation potential of the home itself as collateral). Second, the interest on the mortgage is tax deductible (interest is not included in taxable income). This is a very attractive offer, especially for people with an annual income of $100,000-$150,000 or more. In addition, the home loan policy is very flexible. If the interest rate decreases, you can refinance, that is, borrow money to pay off the original high interest rate loan, and replace it with a low interest rate loan. If you have the money, you can also pay off the rest of the loan in full or in part, or shorten the term of the loan by refinancing, for example, from 30 years to 15 years. After paying off the loan in full or in part, if you lack the funds you can borrow again from the bank in the form of a HELOC, commonly known as a second mortgage.

In my area of the Northeastern United States (New York and New Jersey), home prices are high, but due to the recent decline in interest rates, the monthly interest payments on the principal of the mortgage are not a major burden. The real distracting burden is the land tax, which is up to about 3% in many areas. That’s about $15,000 a year in land tax for a $500,000 house (more than 1,200 a month). This money is always paid and increases every year, even after the mortgage is paid off one day. The worst part is that if the income is high (150,000+) only a part of the land tax can be used to offset the income tax, which is different from the loan interest. Therefore tax status is an important factor in the home buying decision process.