I bought an investment property with cash from the HELOC on my primary residence. Can I deduct this interest payment as expense on my investment property to offset the rental income?
Investor · Clairemont, CA · Member since 2011 · 3k+ posts · 2k+ votes
3y
Yes, lookup interest tracing. Essentially you deduct (or don't deduct) interest on a loan based on what it was used for not necessarily where it came from. E.g. your HELOC is on your primary, but the interest isn't deductible against your primary residential expense, it is deductible against the investment property.
Investor · Clairemont, CA · Member since 2011 · 3k+ posts · 2k+ votes
3y
Yes, lookup interest tracing. Essentially you deduct (or don't deduct) interest on a loan based on what it was used for not necessarily where it came from. E.g. your HELOC is on your primary, but the interest isn't deductible against your primary residential expense, it is deductible against the investment property.
Yes, lookup interest tracing. Essentially you deduct (or don't deduct) interest on a loan based on what it was used for not necessarily where it came from. E.g. your HELOC is on your primary, but the interest isn't deductible against your primary residential expense, it is deductible against the investment property.
Real Estate Agent · Dallas Fort Worth Metroplex · Member since 2022 · 12 posts · 6 votes
3y
How does the payment on that compared to the payment on a conventional mortgage? Did you do an interest only? I am looking to use the equity on my investment property to try to purchase another one so I am very intrigued
How does the payment on that compared to the payment on a conventional mortgage? Did you do an interest only? I am looking to use the equity on my investment property to try to purchase another one so I am very intrigued
I took on my primary. You will find more options and good rates if it’s on primary. Same doesn’t seem to be the case when tapping the equity on investment property. Since the heloc I have is on my primary, it’s pretty much comparable to conventional mortgage rates with no closing cost and I have an option to go for fixed rate (at 5.85% this month).