Yes, this is the recommended procedure for reporting your 1098's. It is recommended to enter your more current mortgage loan balance in Box 2 but this is fine in the way this is entered. Also, when you refinanced, did you take cash out of the refinance for other things other than your home? If not, this is perfectly acceptable the way you reported this.
[Edited 04-29-2021|06:17 PM PST]
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