However, if the taxpayer took out a $250,000 home equity loan
on the main home to purchase the vacation home, then the interest on the home equity loan
would not be deductible.
If you sell your home at a later date, you will need to pay off the equity loan
from the proceeds.
The Government insisted the scheme is supporting "responsible lending", with the average house price being bought under the mortgage guarantee scheme at PS151,597 and the typical price under the equity loan
scheme at PS204,805.
"The scheme is designed to help home buyers secure low deposit mortgages and stagger the cost of buying a home, as they do not pay rent on the equity loan
and it's interest free for the first five years.
"With over 10,000 reservations in four months, it's clear that the Help to Buy: Equity Loan
is working well.
The Cranial Equity Loan
was written over a four-month respite from work on The 89TH Temple, a novel of bullying and teen suicide set in Japan.
Unlike previous schemes which offered equity loans
it's not just open to first time buyers but can be used by other purchasers too.
About One in Three Consumers Used a Home Equity Loan
to Make Home Improvements
Interest on a home equity loan
is deductible only to the extent of $100,000 of debt.
The proliferation of what Fed chairman Alan Greenspan dubbed exotic mortgage products such as adjustable rate loans, piggyback loans, interest only loans, and home equity loans
, whose monthly payments can as much as double if interest rates rise to not unfathomable levels, as well as mixed economic signals such as choppy job growth, and the way real estate appreciation has exceeded salary increases have provided fuel for many an apocalyptic scenario.
The Jacksons also refinanced the home equity loan
they had taken out to renovate a third house they inherited from Jacqueline's father.
The brochure, Putting Your Home on the Loan Line Is Risky Business, warns that regardless of whether a home equity loan
is for a home repair, bill consolidation, or some other purpose, it is important to shop around.