Texas MCC Programs

An MCC will reduce the amount of federal income tax homeowners pay, thus giving them more available income to qualify for a mortgage. With an MCC, the qualified homebuyer is eligible to write off a portion of the annual interest paid on the mortgage as a special tax credit not to exceed $2,000 each year that they occupy the home as their principal residence. The portion or amount of the tax credit is equal to the mortgage credit rate on the MCC multiplied by the annual interest paid. This credit reduces the federal income taxes of the buyer, resulting in an increase in the buyer's net earnings. Increased buyer income results in increased buyer capacity to qualify for the mortgage loan. The MCC has the potential of saving the MCC holder thousands of dollars over the life of the loan.

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While all homeowners can claim an itemized tax deduction for mortgage interest, you can go a step further with an MCC. An MCC reduces your tax liability, dollar-for-dollar, by a percentage of the mortgage interest you pay.

Below are the basic requirements of an MCC program:

  • Purchase a home within the Eligible Loan Area.
  • Be an Eligible Borrower. For a Local Housing Finance Corporation, there are no professions restrictions so just meet the requirements stated here.
  • Be a first-time homebuyer or have not owned a home, as a principal residence, during the last three years.
  • Annual household income does not exceed the maximum allowed income limits.
  • The home’s sale price does not exceed the maximum allowed purchase price limits.
  • Obtaining a first mortgage on the residence. (No refinancing is allowed)
  • Buying the home as your principal residence.
  • Do not intend to use the residence in a trade or business.
  • Most types of homes qualify. New and existing single family homes, duplexes, town homes, condominiums and manufactured homes with certain restrictions are eligible properties.
  • All mortgage loan types are eligible. The MCC program does not place restrictions on the mortgage financing with regard to type, term or rate. Except for loans tied to a tax-exempt bond program.

Here are some links to the local MCC providers

Southeast Texas Housing Finance Corporation

Texas Department of Housing and Community Affairs

If you would like more information on how to apply for these programs click here to leave your information and Ill contact you