Mortgage of $150,000 taken a year after purchase of 1.5 million dollar condo? The original purchase one year before mortgage was made with margin on stock account of $150,000. The reason is that at that time I did not have enough time to get a bank mortgage as if I waited deal would have fallen through, Can I deduct the mortgage interest starting when I actually got a bank mortgage?
No - the bank mortgage was used to pay off a margin loan, not to buy, build, or improve the home that it’s secured by.
For tax years 2018 through 2025, you can only deduct the interest from the amount of your loan that was used to buy, build, or improve the home that it’s secured by.
You cannot "grandfather" from the first loan, because it was not a mortgage - it was secured by stocks.
Q: If you take a loan in 2020 (not a mortgage), loan used fully to buy a condo can you deduct the interest on the loan?
A: No. You cannot deduct the interest.
There are only three interest deductions available - business interest, investment interest and mortgage interest. The transactions you described do not qualify for any of these deductions.
Business interest doesn't apply, you bought a condo to live in, not as a rental property.
Investment interest doesn't apply: you bought a condo to live in, not as an investment.
What qualifies for the investment interest deduction:
"The deduction applies to interest on money borrowed to buy property that will produce investment income—interest, dividends, annuities or royalties—or that you expect to appreciate in value, allowing you to sell it at a gain in the future."
See:What Are Deductible Investment Interest Expenses? for an expanded discussion of this issue.
Mortgage interest doesn't apply: the loan was not a mortgage as it was secured by your stock holdings.
"Generally, home mortgage interest is any interest you pay on a loan secured by your home (main home or a second home). The loan may be a mortgage to buy your home, or a second mortgage".