Little Known, Highly Advantageous First Time Home Buyer Program
There are many mortgage assistance programs offered by various governmental agencies to help first-time homebuyers struggling to purchase their first home. One such program that receives little publicity but is perhaps the most beneficial to first-time homebuyers partners the California Housing Finance Agency (CalHFA) with local counties and is called the Mortgage Credit Certificate Tax Credit Program (MCC).
The MCC program provides an amazing yearly federal income tax benefit – a tax credit equal to 20% of mortgage interest paid annually. Unlike a tax deduction that just reduces your taxable in-come, a tax credit is money given to you and that means money back in your pocket. This helps buyers in the mortgage approval process as well. Since it is guaranteed money given to the buyer, it increases purchasing power in the eyes of lenders. Think of this as additional income to help pay for the expenses that can come along with homeownership like HOA dues, landscaping or home improvements.
I have experience guiding many first-time buyers through the process of utilizing the MCC program, including two of my children, helping them achieve their goal of homeownership. If you know any first-time homebuyers please pass along my contact info and I would be happy to answer any questions they have regarding the MCC program and help them navigate the most important financial decision of their life.
MCC Program Overview:
- Home Buyers Eligibility: Persons who have not owned a principle residence within the past three (3) years
- Federal Tax Credit: 20% of mortgage interest paid each year
- Eligible Mortgages: FHA, VA, USDA-RHS, Fannie Mae, Freddie Mac, fixed or adjustable rate
- Residency Requirement: Must be buyer’s primary residence
- Eligible Properties: Single-family attached or detached, PUD, condominiums and 2-to 4 unit properties as long as one unit is occupied by the homebuyer
- Purchase Price: The maximum sales price of a home in Orange County up to $720,845.
- Household Income Limits: 1 to 2 person: $117,000 and for family of 3: $136,000: