The taxpayer has a second mortgage on his principal residence that he wants to pay off. He borrows money from his brokerage account (securing the loan with his investments in the brokerage account) and pays off the second mortgage loan.. OK, let's use these facts.
Since the brokerage loan is not secured by the principal residence, it doesn’t qualify as home mortgage interest.. And this, too, is true.
But doesn't he get an interest deduction for the interest accrued on the home mortgage, the payment of which interest was directly from the margin loan?