MORE MONEY FOR FIRST TIME HOME BUYERS

More Tax Credits Available for First-Time Buyers

Most potential homebuyers know about the widely publicized $8,000 federal tax credit for first-home purchases in 2009. What many don't know is that they also might qualify for the NC Housing Finance Agency's Mortgage Credit Certificate program, which provides an annual tax credit for as long as they own the home.



Buying Your First Home?
Save Up to $2,000 a Year
on Your Income Taxes
3508 Bush Street, Raleigh, NC 27609
No state or federal tax dollars were used
to print this brochure. February 2009
A SELF-SUPPORTING PUBLIC AGENCY

If you are buying your first home, a Mortgage Credit
Certificate (MCC) from the North Carolina Housing
Finance Agency can put more money in your pocket
and make your mortgage payment more affordable.
The MCC allows eligible buyers to take a federal tax credit of 20
percent of the mortgage interest you pay annually. It can save
you up to $2,000 each year that you occupy your new home. The
MCC can be used with the new $8,000 federal tax credit, until
that credit expires in December 2009.
Because the MCC is an immediate tax credit, you can change
the withholding allowances on your W4 to reflect your decreased
tax liability and increase your monthly take-home pay.
Who is Eligible?
The MCC is available to first-time home
buyers who meet the sales price and
income limits. The maximum sales price
limit is up to $220,000 and the maximum
income ranges from $85,000 for a family
of three in areas such as Raleigh down
to $62,000 in more rural areas.
How Does the MCC Work?
If you borrow $183,000 at 5.5 percent interest, you will pay
approximately $10,000 in interest in the first 12 months of your
mortgage. With the 20 percent MCC, you can reduce your federal
income tax liability by $2,000 for that year, allowing you to reduce
your monthly tax withholding by $166. Over the first 10 years of
ownership, you would save $18,547 in federal taxes. And if you
purchase your home by December 1, 2009, the $8,000 federal tax
credit can be used in conjunction with the MCC. (Consult your lender
for details.) Like all homeowners, you can also claim an interest
deduction on the remaining 80 percent of the interest you pay.
An MCC can be used with almost any fixed-rate mortgage, and
with some adjustable rate mortgages. The property must be the
home buyer’s primary residence.
Learn How an MCC Can Help You
The MCC is offered statewide by the North Carolina Housing
Finance Agency through more than 700 lenders and their
branches. Participating lenders
can be found in the Home Buyers
section at www.nchfa.com
or by calling 1-800-393-0988.