@espencerito1 rather simple... it's the average monthly balance. you are well below $750k.
$650K /12 *8 + $300k /12* 4 months = $533k. It'll actually be less than that due to amortization since the origination of the mortgage. All the interest is deductible.
then there is the 8 months interest related to the $300k mortgage that goes on Sch E.
