Homeownership Programs

Mortgage Credit Certificate (MCC) 2009

effective 02/02/2009

Federal Income Tax Credit for Homebuyers

MCCs are not mortgages...  they are tax credits that put extra cash in your pocket each month, so that you can more easily afford a house payment, which means fewer tax dollars will be withheld from your regular paycheck, increasing your take-home pay. 

How do I apply?

Applications are accepted on a first-come, first-served basis by a statewide network of lenders.  Your lender will establish all underwriting criteria, including interest rate, down payment requirement, term, fees, points, and closing costs.  Your lender will submit your loan application and notify you as to whether your application is accepted.  It is strongly recommended that you contact a tax professional before applying for an MCC in order to determine the potential benefits an MCC may provide for your specific tax situation.

Who are the Participating Lenders?

Bank of America | Cobalt Mortgage | Cornerstone Mortgage Company | Eagle Home Mortgage | Evergreen Home Loans  | First Rate Mortgage | Golf Savings Bank | Guild Mortgage | HomeStreet Bank | Integra Pacific Mortgage | Legacy Group | Metlife Home Loans | Mortgage Advisory Group | Mortgage Master Service Corporation | Prime Lending | Prospect Mortgage |Seattle Metropolitan Credit Union | Sierra Pacific Mortgage | Wallick & Volk | Wells Fargo Home Mortgage

What are the loan types?

MCCs are available with fixed or adjustable rate conventional conforming (i.e., Fannie Mae or Freddie Mac saleable), FHA, VA, Rural Development mortgages.  The Commission’s House Key State Bond Program is not available for use with the MCC Program. 

What are the fees?

The nonrefundable MCC fee is $650 and it is collected at the time of loan closing.

What are the program guidelines?

As with any program, there are qualifying rules and regulations.  MCC eligibility requirements include:

New Loans Only

The MCC is available with new purchase loans only. Refinances are not accepted, unless you are replacing some type of short-term bridge financing with a term of 24 months or less.

Income Limits

Borrowers must not exceed these Maximum Annual Income Limits:

Acquisition Cost Limits

Borrowers must meet these property acquisition cost limits. Acquisition cost limits of a single-family residence must not exceed the following:

 
Eligible Properties

Single-family existing homes, new construction, manufactured homes (permanently) affixed or on leased land), and homes located on Native American trust land, located in both Targeted Areas and Non-Targeted Areas.  Check the Commission’s website Targeted Areas page to see if the property is in a Targeted Area.  Note:  Not all counties have Targeted Areas.

Business Use Limits
No more than 15% of the residence may be used for trade or business purposes.

Owner Occupancy

The MCC is valid for the life of the loan, so long as you remain the owner-occupant of the residence.

Homebuyer Education

You must complete a Commission sponsored homebuyer education course providing you with the steps to buying your home.

Recapture Tax

A recapture tax may apply only in the event that –  you sell your home in the first nine years, and - your income has increased significantly, and - you have a substantial gain on the sale.  IRS Form 8828 explains how the tax is calculated.

What happens if I refinance my loan?  What happens to my current MCC?

If you refinance your property, the MCC may be reissued if completed within one year of refinance and if you qualify under the program guidelines.  The amount on the reissued MCC cannot exceed the outstanding balance of the mortgage prior to refinancing and the certificate credit rate cannot exceed the certificate credit rate specified in the existing certificate.  Further restriction apply.

A $375.00 non-refundable application fee must be included in a reissuance request. 

What happens if I lose my current Mortgage Credit Certificate?

Please contact the Commission for a replacement certificate.  There is a $75.00 fee for this service.

If you have questions about the Mortgage Credit Certificate (MCC) Program, please call us at 800.767.4663 or email askusHO@wshfc.org.

This page was modified on 07/19/2010.