talk to financial institutions. second mortgages generally carry a higher interest rate than first mortgages and complete refinancing will involve again paying mortgage closing costs and points. no one knows where internet rates will be when your bro finds a home so you could end up with higher or lower rate mortgages.
cashing in CDs before maturity usually requires forfeiting some of the interest earned. talk to the bank.
finally family loans. if over $10K IRC 7872 takes effect which involves imputed interest for certain loans which seems to apply in your case. though no interest needs to actually be paid to your bro (lender), he would have interest income and you would have non-deductible interest expense.
special rules apply if the loan is less than $100K:
(1)Limitation on interest accrual for purposes of income taxes where loans do not exceed $100,000
(A)In general
For purposes of subtitle A, in the case of a gift loan directly between individuals, the amount treated as retransferred by the borrower to the lender as of the close of any year shall not exceed the borrower’s net investment income for such year.
also you have to look to the financial institution. some may not like the fact you're borrowing some of the down payment from your bro.
