Using the numbers you provided and Table 1 in Publication 936 the deductible mortgage interest is 27,413 plus the deductible points.
Step 1 is to get the average mortgage balance for each loan.
Newest loan total first and last balances for the year and divide by 2 = 1,045,000; you paid on that loan for 8 months so 1,045,000 (8/12) = 696,670 average loan balance
Same process for the old loan you paid for 9 months. 516 + 508 = 1024/2 = 512
512 (9/12) = 384 average loan balance
Step 2 is find the loan limit using Table 1. When you plug in the loan balances above you will find that $750K is your limit because the oldest loan balance is actually less than $750K.
Back to Table 1, add the loan balances together to get 1,080,670. 750,000/1,080,670 = .694 x interest paid 39500 = 27,413
Assuming you can and are deducting all your points on the new loan this year the total deduction in your scenario would be 1725 + 27413 = 29,138
If you deducting points over the life of the loan then add the prorated points to the mortgage interest.
That number can be put in the "Your adjustments" box to override the TurboTax calculations. Be sure to keep your calculations with your tax records.
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