Points Paid to Secure a Mortgage to Purchase a Primary

question 119

True/False

Points paid to secure a mortgage to purchase a primary residence will generally be tax deductible as interest in the year they are paid.

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Definitions:

Amortized

The process of paying off a debt through regular payments that cover both principal and interest.

Principal Balance

The outstanding amount of a loan or mortgage that remains to be paid, not including interest.

Personal Loan

A type of unsecured loan provided by financial institutions based on the borrower’s creditworthiness without collateral.

Perpetuity

A type of annuity that continues indefinitely, often used in finance to model consistent payments or cash flows without an end date.