Save s with a Mortgage Credit Certificate MCC

The mortgage credit certificate (MCC) can shave $1,000s off the cost of home financing. This tax credit is available in about 25 states. Although an MCC doesn't directly reduce your interest rate, it does help you qualify for a larger mortgage with lower payments by cutting thousands of dollars off your income tax bill.

State and local housing finance agencies cooperate to sponsor MCC programs with selected mortgage lenders. An ad for the Massachusetts American Dream/MCC first-time buyer mortgage plan, says, "This special Mortgage Credit Certificate will lower your income taxes and increase your buying power." Table 3.8 illustrates the Massachusetts Housing Finance Agency (MHFA) program using an 8.875 percent, 30-year, fixed-rate mortgage of $100,000. (Of course, the MHFA used 8.875 percent only for illustrative purposes. Market or below-market rates typically apply.)

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