It's just not deductible. To be deductible, the loan has to be secured by the property. Furthermore, even if he were to refinance the home to get a mortgage in his own name (and pay off your Schwab loan), it would not qualify if it was more than 90 days since buying the property. See Part II, limits on the deduction, in publication 936.
https://www.irs.gov/publications/p936
