Refinance "Loan Origination" Question

#3 02-22-2004, 06:00 AM

Steve B wrote:
- quote -

> "Harlan Lunsford" <lunstax[at]bellsouth.net> wrote:

> > If not with the same lender, that is the way you deduct, or
> > as we are fond of saying, amortize your points.

> Thank you for the response. I forgot to mention that this
> is NOT the same lender. In fact, I have spoken with the
> lender and he mentioned that the 1% is really just a profit
> center for them, as they may sell the mortgage at a small
> loss. The 1% does not go to prepaid interest, etc.
> I am still fuzzy on this. Can I depreciate the $885 over
> the life of the loan having said that?

Don't really matter what the banker calls it if it's really
points, you may "amortize" them over the life of the loan.

CheeR$,
Harlan Lunsford, EA n LA

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#2 02-22-2004, 05:40 AM

- quote -

> do not know, however, what makes up the $885.

It's interest for the privilege (?) of paying interest.

Nan, EA in LA

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#1 02-22-2004, 12:17 AM

"Harlan Lunsford" <lunstax[at]bellsouth.net> wrote:

- quote -

> If not with the same lender, that is the way you deduct, or
> as we are fond of saying, amortize your points.

Thank you for the response. I forgot to mention that this
is NOT the same lender. In fact, I have spoken with the
lender and he mentioned that the 1% is really just a profit
center for them, as they may sell the mortgage at a small
loss. The 1% does not go to prepaid interest, etc.

I am still fuzzy on this. Can I depreciate the $885 over
the life of the loan having said that?

Thanks in advance,
Steve B

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

02-19-2004, 03:32 PM

Steve B wrote:

- quote -

> On September 22, 2003, I refinanced my home. In the
> "Settlement Charges" section of the Settlement Statement,
> Line 801 reads as follows:
> --> Loan Origination Fee to BANKNAME POCL $885.00
> This is 1% of my principle borrowed. The section goes on to
> list misc fees to the bank, interim interest, hazard
> insurance, taxes, title charges, etc.
> My question is, may I deduct the $885 over the life of the
> loan (180-months)? Based on my understanding of Publication
> 936, I *can* if this is for interim interest, and not for
> services. I do not know, however, what makes up the $885.

If not with the same lender, that is the way you deduct, or
as we are fond of saying, amortize your points.

Cheer$,
Harlan Lunsford, EA n LA

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

#-1 02-18-2004, 06:08 PM

On September 22, 2003, I refinanced my home. In the
"Settlement Charges" section of the Settlement Statement,
Line 801 reads as follows:

--> Loan Origination Fee to BANKNAME POCL $885.00

This is 1% of my principle borrowed. The section goes on to
list misc fees to the bank, interim interest, hazard
insurance, taxes, title charges, etc.

My question is, may I deduct the $885 over the life of the
loan (180-months)? Based on my understanding of Publication
936, I *can* if this is for interim interest, and not for
services. I do not know, however, what makes up the $885.

Thanks in advance!
Steve

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

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