Tuesday, October 15, 2013

MCC Is it Right for Me?

MCC - Mortgage Credit Certificate for first time homebuyer(s)
The MCC can be a great tool to assist in generating more buying power for you as a homebuyer and /or as a Realtor helping your customers purchase a home they may not qualify for otherwise.
First-time Homebuyer Requirement - The Applicant who will become an MCC holder cannot have had an Ownership interest in a Principal Residence at any time during the preceding three years ending on the date on which the loan is executed.
As long as you are not pushing the income limitations and you plan on staying in your home for 9 years, you will most likely avoid any recapture tax of the monies you saved.
The Home buyer Benefit
The MCC will reduce the amount of income taxes due to the federal government; however, the tax benefit cannot exceed the amount of federal taxes owed for the year after other credit and deductions have been taken. Instead, the tax credits can be carried forward three years until used.
Typically you can increase your buying power by an additional $166 per month. This could equate up to an additional $30,000.00 in a purchase price, depending on the mortgage program and your credit and income qualifications, which are subject to approval and the current market rates.
To see if MCC is right for you; email me at hcraig@homelending4u.com

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