look at irc reg 1.163-8T. this is the tracing rule for determining where and if you can deduct interest on the borrowings. specifically look a the example under (c)(1) and (d)(1)
https://www.law.cornell.edu/cfr/text/26/1.163-8T
also see irc sec 163
did find something an example
my version
joe borrows some money. (the actual example does not state whether or not the loan is secured). uses it to buy real property. uses 1/3 as personal residence and 2/3 as rental property. first all principal payments and interest are allocated to his portion until it is paid off. after the 1/3 is paid off the remaining payments are allocated to the rental property.
