A new bipartisan bill could help millions of middle-class Americans save on homeownership costs. In a rare show of bipartisan unity, lawmakers in the House of Representatives have introduced legislation aimed at easing the financial burden of mortgage insurance premiums for middle-class families. H.R. 2760, officially titled the Middle Class Mortgage Insurance Premium Act, was recently introduced by Rep. Vern Buchanan (R-Fla.) with support from 10 co-sponsors across party lines, including Rep. Jimmy Panetta (D-Calif.).
If passed, the bill would amend the Internal Revenue Code of 1986 by increasing the income cap and making permanent the tax deduction for mortgage insurance (MI) premiums — a provision that previously expired after the 2021 tax year.
Supporting Homeownership Through Targeted Tax Relief
Mortgage insurance premiums are often a mandatory cost for homebuyers who put down less than 20% on their home purchase—and that includes many middle-class Americans. While these premiums are a gateway to affordable financing, they can significantly increase monthly mortgage expenses.
Rep. Buchanan emphasized the urgency of addressing affordability: “With housing prices skyrocketing in Florida and across the country, it’s our responsibility to provide tax relief for middle-class families seeking to own a home.”
The bill has drawn strong support from a range of stakeholders, including industry trade groups like the Mortgage Bankers Association (MBA) and U.S. Mortgage Insurers (USMI), both of which have long advocated for greater affordability in the housing sector.
Jimmy Panetta, one of the Democratic co-sponsors, noted the potential long-term benefits: “Our bill would make the mortgage insurance premium tax deduction permanent and update the income threshold so more middle-class homeowners can benefit.”
Why This Matters: Millions Have Already Benefited
From 2007 to 2021 — when the deduction was previously in place — the mortgage insurance tax break was claimed 44.5 million times, amounting to $64.7 billion in total deductions. The average qualified taxpayer received an annual deduction of $1,454. Since its expiration, many low- and moderate-income families have lost access to this valuable financial relief.
Seth Appleton, president of USMI, called the bill “common-sense legislation” and stressed its importance: “The Middle Class Mortgage Insurance Premium Act is a positive step towards putting money back in the pockets of taxpayers and making homeownership more affordable for American families.”
Industry and Policy Leaders Back the Bill
Both the MBA and USMI have consistently pushed for reforms that support access to affordable mortgage credit. With the current housing affordability crisis compounded by inflation and rising interest rates, many industry leaders believe this bill could serve as an immediate and impactful solution.
Bob Broeksmit, president and CEO of the MBA, recently underscored the urgency of reducing mortgage insurance costs, particularly for Federal Housing Administration (FHA) loans — which often serve first-time and lower-income buyers.
By addressing this policy gap, the Middle Class Mortgage Insurance Premium Act could serve as a stepping stone toward broader housing affordability initiatives. It’s also an example of how targeted tax policy can make a tangible difference for millions of aspiring homeowners.
What’s Next?
The bill has been referred to the House Committee on Ways and Means. While the full legislative text is still pending, the widespread support and practical benefits it offers suggest promising prospects.
As the legislative process unfolds, homebuyers, industry professionals, and policymakers alike will be watching closely. For now, the message is clear: lowering mortgage insurance costs could open the door to homeownership for many families across the nation.
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