loan debt Case 1:You in the 28% income tax bracket, wish to borrow $60,000 to pay for a new car. To finance the purchase, you can either borrow the $60,000 through the auto dealer at an annual interest rate of 6.0%, or you can take a $60,000 mortgage on your home. The best annual rate they can get on the second mortgage is 7.2%. you already have qualified for both of the loans being considered. If you borrow from the auto dealer, the interest on this "consumer loan will not be deductible for tax purposes. However, the interest on the second mortgage would be tax deductible because the tax law allows individuals to deduct interest paid on a home mortgage. Which of the alternatives is suitable and cheaper for you? loan debt Case 1:You in the 28% income tax bracket, wish to borrow $60,000 to pay for a new car. To finance the purchase, you can either borrow the $60,000 through the auto dealer at an annual interest rate of 6.0%, or you can take a $60,000 mortgage on your home. The best annual rate they can get on the second mortgage is 7.2%. you already have qualified for both of the loans being considered. If you borrow from the auto dealer, the interest on this "consumer loan will not be deductible for tax purposes. However, the interest on the second mortgage would be tax deductible because the tax law allows individuals to deduct interest paid on a home mortgage. Which of the alternatives is suitable and cheaper for you