Hi, you'll need to look at your closing statement for this ...
Find which fees on your HUD-1 settlement statement are points. Not all of your closing costs are points. Locate the origination points and the discount points. The IRS does not classify any settlement fees other than these as points.
The settlement statement must clearly show the points as a percentage of your loan amount.
You cannot change the other closing costs such as title insurance and appraisals into points just to write them off.
And finally... You must have paid the points out of your own funds at the time of closing; the loan cannot include financing the points into the loan.
If the total you mention is all encompassed as EITHER origination points OR discount points, you can deduct it all
The way you worded you question? ... it sounds very much like you may e able to deduct it all ("I paid $5580 for a 2.5 interest rate." = discount points) and ("$2,636 for getting loan" = origination points)
Other things? .... (1) You have to itemize (these are schedule A deductions) (2) The logic for this as a deduction is that IRS considers these points as "pre-paid interest," and (3) you must have actually paid (not rolled into the loan amount)
I still don't see you coming into the chat session, so I'll move us to the "Q&A" mode. … Maybe that will help … (We can still continue a dialogue there, just not in real-time chat, as we can here)
Please let me know if you have any questions at all ...
It's been about 10 minutes here, so I'm guessig we're having system problems - system HAS been down some today ... by moving us to Q&A we can be sure to continue, in case you have follow-up questions
Let me know …