Mortgage interest deduction at risk in budget negotiations.

Nothing has been decided yet, but the New York Times reports that the mortgage interest deduction may be subject to negotiation in the upcoming budget talks in Washington. 

Any limitation on the mortgage interest deduction would place further downward pressure on the real estate market, resulting in increased difficulty selling underwater homes and further losses for lending institutions.
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Update - the idea of limiting or eliminating the mortgage interest deduction appears to be a bargaining chip or ploy to help the administration get what it really wants - higher income tax rates.