<prompt> Human: Hey everyoneI am going to be purchasing a home from my parents in a few months. They have agreed to effectively act like a mortgage broker for the transaction. They are going to switch the deed to my name, but I will be paying them a 30 year mortgage at 3.This will obviously be a personal agreement between us. But I was wondering if any one knew of a way that I could claim the interest I pay them as mortgage interest on my taxes? Could I set them up as a bank in the eyes of the government in some way? Any help is sincerely appreciated! Thanks!  <response>: Hi There! In order to deduct mortgage interest on your tax return, you need to meet the following criteria see Pub 936 - The debt needs to be secured by the home - so youll need to visit an attorney and get documents drawn up You can only take interest on the debt of a first or second homeYour parents do no need to issue a Form 1098 to you for the interest that you pay during the year because they are not mortgage lenders in their ordinary trade or business.You will report the interest on line 11 on Schedule A - you will need to include your parents name and SSN so the IRS can make sure theyre picking up the interest.There is no minimum interest rate that they can charge for you to be able to take the mortgage interest deduction. If they happen to charge under a certain interest rate, though, they will have to impute interest income and gifts.Remember to file all of your Real Estate Excise Tax Transfer documents with your state. I would highly suggest visiting an attorney to assist with all of this. 