For 2nd home mortgage which is not original loan and not a HELOC, what do I check?

[ma-teresa1015]

On Turbo tax, it is asking if it's original loan which it is not since it's a 2nd mortgage.  It is asking if it's a mortagge loan that I've refinanced or a HELOC which is neither.  It is  a Fixed 2nd home mortgage loan.

[KrisD · Accepted solution]

If this second loan is secured by the second home, it is an original loan. 

If this second loan is secured by the first home (but used for the second home) it is a HELOC. 

[ma-teresa1015]

The 2nd mortgage is secured by my home, there is no second home. So is this a HELOC?

[KrisD]

Yes, Home Equity Line Of Credit. You had equity (the portion of the value of the home that you own but you don't owe on) that you used to get the second loan. For example, if I purchase a 200,000 home and take a 180,000 mortgage, I have 20,000 of equity built in. Say 5 years later, my loan has been paid down to 160,000 and my home is now worth 220,000, I have 60,000 in equity and possibly could take a "second loan" out on my home for up to this amount. This is a HELOC. The "deductibility" of the interest on these loans have changed for 2018 because of the Tax Cuts and Jobs Act.
<a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/p936.pdf">https://www.irs.gov/pub/irs-pdf/p936.pdf</a>