2008 SETH MCC Program
What is an MCC?
The Mortgage Credit Certificate (MCC)Program was
authorized by Congress in the 1984 Tax Reform Act as a
means of providing housing assistance to families of low
and moderate income. It is an alternative to the bond
The MCC is a tax credit that reduces the amount of federal
income tax paid and provides additional available
income to help qualify for a mortgage loan and assist
with the new house payment.
The SETH MCC is available to buyers purchasing a
residence in SETH’s jurisdictions and meeting required
household income and purchase price limits. Buyers
may be subject to paying a federal recapture tax if they
do not remain during the recapture period - usually 9
A Mortgage Credit Certificate (MCC)
provides a federal income tax credit to the
borrower for as long as they own and
occupy their home.
Tax credits are a powerful way of increasing
a family’s annual income.
What does an MCC do?
The federal government allows each homeowner to claim
an itemized income tax deduction for the amount of
interest paid each year on the mortgage loan. A
deduction reduces the amount of income that is taxed.
The MCC Program takes a portion of the mortgage interest
paid and turns it into a tax credit. A tax credit is an
amount returned to the buyer either by increasing the
amount refunded in their tax return or decreasing the
amount of taxes owed.
Because they are good for the life of the loan, an MCC may
save a homeowner thousands of dollars as long as the
certificate holder is living in the home. MCC’s may be
used with any loan type EXCEPT an MRB loan.
Highlights of the 2008 SETH
• The 2008 SETH MCC • The maximum tax
Program provides a credit a homeowner
tax credit of 30% of can claim is limited
the interest that the to $2,000.
homeowners pays • Unused tax credits
annually on their can be carried
mortgage loan. The forward for up to 3
credit may be taken years to offset
annually or monthly. future income tax
Example Of The Tax Credit Provided
By The SETH MCC Program:
Loan Amount= $100,000
Interest Rate= 6%
Homeowner pays $6,000 in mortgage interest that year
MCC Tax Credit Rate= 30%
As a result, the homeowner receives an MCC
Tax Credit= $1,800 ($6,000 x 30%)
First Time Homebuyers
under 80% of area
median incomes may
qualify for a $2,000
Grant with this program.
Can I Use The MCC Program?
You should answer “yes” to all of the following questions.
Am I buying a home in one of the
Am I able to qualify for a mortgage
loan with a participating lender?
Is my income under the established
limits based on location of the home
and family size?
Is the sales price of the home under
How is the Lender Involved?
Lenders basically are making mortgage
loans- just like they do everyday. A
borrower can use any of the lender
products available in the market place.
Lenders retain the servicing on the loan.
The MCC’s are not issued directly to the
homebuyer. Buyers must obtain financing
from local lenders who choose to
participate in the program.
What are the
• Additional tax credit
each year (up to
• Tax credit can be used
to help qualify for your
• MCC is assumable
and may help you sell
your home in the future
• $2,000 Grant for
How do I get started:
Get started today by contacting a participating lender from
the list provided on our website.
If you have any questions, you may call us directly at