mortgage was sold to another lender now I have two 1098
my mortgage was sold to another lender and now I have 2 1098, and don't know how to file them. can any help me with this problem?
Answers
-
If you have two 1098 forms, you will enter each one individually in the "Deductions/Credits" section under the "Homeowner Expenses" subheading.
When you enter your 1098 form(s), you will be asked, "Is this Form 1098 for a mortgage that was refinanced or sold to another lender during 2023?" If you select "Yes" to this question, your mortgage balance will be calculated correctly. Which will not require you to adjust your interest expense if your mortgage amount is below the IRS limitation for 2023. You can deduct home mortgage interest on the first $750,000 ($375,000 if married filing separately) of indebtedness. However, higher limitations ($1 million ($500,000 if married filing separately)) apply if you are deducting mortgage interest from indebtedness incurred before December 16, 2017.1 -
I also have two 1098 forms for the same mortgage that was sold in 2023, and I am a bit confused by the wording of the note below the checkbox:
"Is this Form 1098 for a mortgage that was refinanced or sold to another lender during 2023?
If this Form 1098 is from the mortgage you had on January 1, 2023, answer No."Does this mean I only answer Yes on the 1098 from the company that took over the loan, and answer No on the 1098 from the old lender which had the loan in January 1, 2023? Or do I answer Yes for both? Thanks in advance!
0 -
Correct. Answer YES to the 1098 that was sold and No to the one that was not. Basically, we are trying to help the software determine if your average mortgage balance was over $750,000 and your mortgage interest is limited.
1 -
I did a refi in 2024 and have 2 1098 forms. I’m getting an error message before finalizing stating I need to input the “Loan Balance as of Jan. 1, 2025” for both 1098’s even though the loan balance is $0.00 (for the refinanced 1098). Not sure how to continue…
1 -
Thank you for bringing this to our attention. We are looking into any possible errors on this page now.
1 -
I am having this same issue.
0 -
Hi!
This should be fix in our next roll out. Try signing back into your account in a few days. You may need to go back to the page where you enter a 0 to enter again, but the alert should be gone. Let us know if you are still having problems.
0 -
This has now been fixed. You should be able to enter $0 as the Jan 1, 2025 loan balance of the refinanced loan. Thanks for waiting while we updated our software!
1 -
My mortgage was sold to another lender and now I have two 1098,
I took mortgage of $725000 on 08/21/2023, I am married and filing jointly.
For the previous lender I added interest $X amount and outstanding $X amount, Mortgage Origination Date: 08/21/2023,
Was this mortgage refinanced or sold to another lender in 2024? - Yes
Did you use all of the money from this loan to buy, build, or substantially improve your home? - No
Was this loan for your main home? - Yes
For the new lender I added interest $X and outstanding $X, Mortgage Origination Date: 08/21/2023,
Was this mortgage refinanced or sold to another lender in 2024? - No
Did you use all of the money from this loan to buy, build, or substantially improve your home? - No
Was this loan for your main home? - Yes
Next page added property taxes,
But on Next page why is it asking to
Confirm your average mortgage balance,
Since you had a mortgage that was used at least partially for purposes other than buying, building, or substantially improving your home, you'll need to calculate your average mortgage balances below using the rules etc.
I did not use any loan money buying, building, or substantially improving your home, it is just loan transfer for lender A to B, I do not know what to do with it? First time it shows $1M over amount in Average Balance inside mortgages that started after December 15, 2017, box,
I erased the amount now it is not re-calculating, do I need to mention any amount? if yes then the software is not auto-calculating it again.
Can you please help?
0 -
Hi DPatel,
The most important outcome is to make sure your interest is not limited, since the average balance falls below $750,000. However you said you answered NO to the question, "Did you use all of the money from this loan to buy, build, or substantially improve your home?" However, the loan was used to buy your home, correct? So you need to change that answer to YES. Here are some steps to follow along with some sample screen shots.
- Then when you get to the "Tell us more about each loan shown below" the original loan will have a balance of $0 on "Loan balance as of January 1, 2025:" and the New Lender will have a balance of $725,000 (or lower) on January 1, 2025.
- On the "Confirm your average mortgage balance" the first two boxes will be $0 and the 3rd box will have the average balance which will be something lower than $725,000.
If you still have question contact Customer Support while signed into your account so a tax expert can view your details and ask you any questions.
0 - Then when you get to the "Tell us more about each loan shown below" the original loan will have a balance of $0 on "Loan balance as of January 1, 2025:" and the New Lender will have a balance of $725,000 (or lower) on January 1, 2025.
-
Thanks Matthew,
Did you use all of the money from this loan to buy, build, or substantially improve your home?" However, the loan was used to buy your home, correct? - Yes Correct
this question is asked for old and new lender, shall I select Yes at both places?
Best,
Dhruv
0 -
Hi Dpatel,
Answer YES for both questions on the 1098s.
0 -
If my old loan was refinanced, is it possible to have a loan balance, or should it say “0”? Because my 1098 shows my ending balance on the old loan to be what I owed before the load was refinanced.
Should the answer for the old loan balance always be “0” ?
0 -
Hello, I am having that same issue and today is 3/31/25. Just inputting the two 1098s is flagging other questions that is making it difficult to finish.
0 -
I’m wondering why the two 1098s list the origination date as the same. Why wouldn’t the new lender who bought my loan , put the acquisition date as that lender’s origination date.
0 -
I think they use the original origination date since it is NOT a new mortgage. They are only taking over the service agreement.
1
