What is Changed?
Under the previous tax law, you can deduct mortgage interest on up to $1 million in debt.
Under the new tax law, you can only deduct interest on the first $750,000 or mortgage debt, and this applies to qualified residence. Also, the interest on home equity lines of credit (HELOC) and home equity loans, used to be deductible on loans up to $100,000 even if you did not use the funds for home improvement, now can not be deducted unless the loan is related to home improvement or acquiring or building a home.
What to Do?
Consider buying a less expensive home or trying to reduce the size of the mortgage by increasing the down payment. Also, before taking out a HELOC loan, evaluate the cost of doing so if there is no tax deduction on the interest you pay.