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1 Comments on"Affordable Mortgage Financing For Condo and Home Purchase"
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Condo says:
Home-Equity Lines of Credit…Many lenders will encourage you to take out a home-equity line of credit on your primary residence to fund all or part of your second home purchase. With interest rates low, this option is certainly worth considering.However, keep in mind that most home-equity lines of credit float a point or two higher than the prime rate, so you could end up repaying this piece at a much higher interest rate than if you had simply taken a mortgage for the entire amount. Plus, unlike mortgage interest, which is deductible on up to $1 million of debt on your first and second homes combined, the home-equity cap is $100,000. (You get a break on $1.1 million total.One trap to avoid is starting with a home-equity loan with the intention of taking out a mortgage at a later date. There is a little-known IRS rule that states that you have just 90 days from purchase to secure a mortgage against a principal or vacation residence. Once you pass that 90-day mark, you can’t deduct the mortgage interest at all.
Posted on 01/17/2009 at 3:48 AM