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New Member
posted Jun 3, 2019 1:27:07 PM

Very confused by the question "Is this loan a home equity line of credit or a loan you've ever refinanced?". What is meant by original loan?

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Level 2
Jun 3, 2019 1:27:08 PM

An "original loan" means the loan (mortgage) you took out when you purchased your home.  

"Refinancing" means that you re-negotiated your mortgage for a better interest rate, or maybe to take some cash from your home's increased value.  This increased value is your "home equity".  Unless you used the cash to improve, buy or build your home (add a deck, remodel the kitchen, etc.), the interest on the cash you take out is not tax deductible, which is why this question is asked.

Finally, a "home equity line of credit" is a separate loan - usually for a pre-approved amount - that uses a part of your home's value to secure the loan.  It's a lot like a mortgage in that respect, but again, if you do not use it to improve, buy or build your home, the interest is not deductible.