With all of the creative financing options of the past several years’ one option that has been forgotten is the good old-fashioned Mortgage Credit Certificate (MCC). In the early to mid 90’s the MCC was a popular tool for many first time home buyers. Here are answers to some common questions about the MCC program.
What is an MCC?
An MCC is a dollar for dollar tax credit on a borrower’s federal tax return. This credit is used to offset a tax liability.
Who is eligible?
MCC’s are generally limited to First Time Home buyers. Some State/Local Housing Financing agencies allow buyers in targeted area’s to be non-first time buyers. Generally MCC’s are limited to low to moderate-income borrowers. Income limits vary according to the geographic location of the property.
How much is the credit and how is it calculated?
An MCC credit is equal to a minimum of 30% of the interest paid by a borrower during the year, but it is available every year as long as the borrower resides in the home. That could worth thousands of dollars!
How will it help my clients?
If a borrower pays $6,000 a year in interest and has a 30% MCC credit, that credit amounts to an extra $1,800 for the borrower over the year. In addition for borrowers with higher debt ratios the MCC credit may help them qualify.
How do my clients take advantage of the MCC program?
We will help your clients determine their eligibility. If eligible we will help them complete all necessary paperwork.
Learn More Here;
http://www.tdhca.state.tx.us/homeownership/fthb/mort_cred_certificate.htm
Give me a call to learn all of the details and to find out how to use an MCC to sell more homes!
Mark Hairston
(512) 789-6967
