Question

ASSIGNED READING:

McGann: Reading 24, “How Homeownership Became the Engine of American Inequality.” Matthew Desmond

Response Question:

What is the MID, and what benefits does it provide to homeowners? What other economic benefits do homeowners receive, beyond the MID? How does homeownership matter for families' ability to pass down wealth to future generations? How does the MID exacerbate wealth inequality in the US?

Remember: The minimum length for reading responses is 200 words, but you are welcome (and are encouraged to) write more than this.

Answer 1

Ans)

MID

Motor insurance databaseThe MID is the central record of all insured vehicles in the UK. It is managed by the MIB and is used by the Police and the Driver and Vehicle Licensing Agency (DVLA) to enforce motor insurance laws.

Motor insurance database involve

1 includes all vehicles that are permanently registered to any one whether leased or owned.

2Temporary vehicles such as short term hire .

3 Customers’ vehicles in your possession for 14 days or more..

4 Any other vehicles regularly covered under your Motor Trade insurance policy.

Benifits of home ownership

Home ownership bulit wealth over time

Homeownership can be a very savvy financial move – it is the best way to save money and be secure in future the ownership provide confidence to a person and also prsovide shelter .

You Build Equity Every Month

Your equity in your home is the amount of money you can sell it for minus what you still owe on it. Every month you make a mortgage payment, and every month a portion of what you pay reduces the amount you owe. That reduction of your mortgage every month increases your equity.

Tax Deductions on Home Equity Lines

In addition to your mortgage interest, you can deduct the interest you pay on a home equity loan (or line of credit). This allows you to shift your credit card debts to your home equity loan, pay a lower interest rate than the horrendously exorbitant credit card interest rates, and get a deduction on the interest as well.

You Get a Capital Gains Exclusion

If you buy a home to live in as your primary residence for more than two years then you will qualify. When you sell, you can keep profits up to $250,000 if you are single, or $500,000 if you are married, and not owe any capital gains taxes. Now, it may sound ridiculous that your house could be worth more than when you purchased it after these past several years of falling house prices. However, if you purchased your home anytime prior to 2003, chances are it has appreciated in value and this tax benefit will come in very handy.

Mortgage Is Like a Forced Savings Plan

Paying that mortgage every month and reducing the amount of your principal is like a forced savings plan. Each month you are building up more valuable equity in your home. In a sense, you are being forced to save—and that’s a good thing.

Long Term, Buying Is Cheaper than Renting

The first few years, it may be cheaper to rent. But over time, as the interest portion of your mortgage payment decreases, the interest that you pay will eventually be lower than the rent you would have been paying. But more importantly, you are not throwing away all that money on rent. You gotta live someplace, so instead of paying off your landlord’s home or building, pay off your own.

that homeownership gives more control to owners over their physical surroundings and tenure, lowers real monthly payments over time, protects against unanticipated changes in rental costs, and helps build wealth.

Build up a stronger financial future

The recent recession threw a wrench into the idea that home ownership always builds wealth over time. But the fact remains that owning a home is one of the fundamental means of accumulating wealth as we age.

Home ownership tax deductions

You get a number of tax breaks for owning a home, most notably a deduction for the interest and property tax portion of your mortgage

Amass equity

Every single month that you pay your mortgage you own just a bit more of your home. This is a big benefit over renting, where you’re paying comparable monthly fees without any comparable stakeyts

Weath for future generations

Generational wealth is wealth that is passed down from one generation to another. This is through the accumulation of assets for the future to provide financial security.’

It is a intangible benefits fostered through home ownership. And while these findings strengthen the policy case for encouraging sustainable and responsible home ownership, ultimately the question is how to arrive at sustainable and responsible home ownership. As the study reviewed here suggested, homeowners performed better financially because they were able to manage their limited resources. It appears that educating would-be homeowners in ways to effectively manage their resources may also help provide a positive environment for their children.

Inequality in us

income inequality is the large disparity in how income is distributed between individuals, groups, populations, social classes, or countries.Income inequality has increased in the United States over the past 30 years, as income has flowed unequally to those at the very top of the income spectrum. Current economic literature largely points to three explanatory causes of falling wages and rising income inequality: technology, trade, and institutions.