“Income Tax implications:
Deductibility of interest on a principal residence or a rental property is for acquisition debt. If you purchase all cash, the maximum loan amount for which you can deduct the interest is $100K. SO, most of your interest debt is not deductible in the scenario you described.”
I believe that it is the case that if you refi within 12 months of purchasing cash the loan is considered “acquisition” debt. Please check me on this as I looked at the tax documents years ago.
