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Mortgage Credit Certificate MCC Available in most counties in Texas through State or Local Housing Finance Corporations.

Supplied through First Southwest


Two Main Benefits to the Homebuyer:

Provides a non-refundable tax credit up to $2,000 a year as long as the homebuyer occupies the home and has a mortgage. 


 Calculated by taking the annual interest on the mortgage loan

multiplied by the mortgage credit rate of 35%.

 For Example:

On a $120,000 loan at a 5.00% interest you will be paying approximately

 $6,000 in interest.   With the MCC You will receive a tax credit of 35% of the interest paid up to a maximum of $2000.  In this instance the 35% is $2100 and all you will receive is the $2000 Maximum

The homebuyer must have tax liability ( Owe Taxes) to benefit from the annual credit in any given year.

The advantages of the MCC

Can help qualify the homebuyer. For Fannie Mae, Freddie Mac and USDA-RHS, you can increase the homebuyers income by the tax credit amount. For FHA and VA, you can reduce the monthly payment by the tax credit amount. This results in increased buyer capacity to qualify for the mortgage loan.

 (Maximum Tax Credit Amount of $2,000/12 = $166.67 per month)

Market Rate Program. Rate, term and type determined by the lender. Normal Underwriting.

How a Homebuyer Qualifies:

 1)  Homebuyer must purchase a home within the Eligible Loan Area.

 2) Homebuyer could not have owned a home in the last three years as their primary residence

         unless purchasing a home in a Targeted Area or the homebuyer is a Qualified Veteran.

  3) Homebuyer’s household income and the purchase price must not exceed the maximum 

        limits set by the Program.

 4) Homebuyer must occupy the home as their principal residence.

 5) Homebuyer must apply for the MCC through a participating lender. (Chris Cook)

  6) Cost for the MCC varies by program. The fees can be paid by buyer, seller or lender.

  7) Can be utilized with city and/or county DPA programs. (If allowed by that HAP Program?)

       Examples of Household Income

  Family of 2 Dallas, Collin County $70200 Tarrant County $69800

  Family of 3 or more in Dallas County $80615 Tarrant $79580

                      Please view Texas Income table