at a rate of 2% above my interest rate. If I use this loan to fix up my home is the interest paid tax deductible?
2007-06-15 10:29:49 · 5 answers · asked by Traveler 4 in Business & Finance ➔ Personal Finance
You can only deduct interest on loans SECURED by you home. How you USE the money is not relevant for taxes. I agree with whoever said "Why borrow against your savings account?" You come out ahead just withdrawing the money.
2007-06-15 12:33:32 · answer #1 · answered by STEVEN F 7 · 0⤊ 0⤋
It's not tax deductible unless you put your home up for collateral as security for the loan. That's why so many these days are using HELOC's to purchase items they need. A HELOC makes the interest tax deductible.
But, that said, may I ask why you would borrow the money to fix up your home when you have it in the bank ?
2007-06-15 10:36:55 · answer #2 · answered by acermill 7 · 0⤊ 0⤋
Maybe I'm missing something here, but why would you borrow money to fix up your house when you have the cash to do it? Why indenture yourself and why pay interest. Please do yourself a favor and go to daveramsey.com. He won't try to sell you anything. Just read his book (borrow from the library and listen to his show for free. Don't live on credit. Use cash for almost everything and a debit card when you have to.
2007-06-15 10:36:13 · answer #3 · answered by moneywise 3 · 2⤊ 0⤋
No, it's not, it will be same as a interest from credit cards. If you have a home, take line of credit for your house, even if it's 1% more, but it's tax deductible, like your mortgage interest.
2007-06-15 10:36:51 · answer #4 · answered by reality 6 · 1⤊ 1⤋
BORROW against your own money, so you will pay them to use your own money?
2007-06-15 10:44:28 · answer #5 · answered by ron d 3 · 0⤊ 0⤋