What Is a Mortgage Credit Certificate? The Texas Tax Credit Most Buyers Miss

Ask ten homebuyers if they have heard of a Mortgage Credit Certificate and nine will say no. That is a shame, because an MCC can save qualified buyers money every single year they own the home.

Credit vs. Deduction

A tax deduction lowers your taxable income. A tax credit lowers your tax bill dollar for dollar. An MCC converts a percentage of the mortgage interest you pay each year into a federal tax credit, and you can still deduct the remaining interest if you itemize.

Where Houston Buyers Get an MCC

I place eligible buyers with the SETH (Southeast Texas Housing Finance Corporation) MCC, and where SETH does not cover the area, the TDHCA Texas Mortgage Credit Certificate. There is a program fee, and for the buyers who qualify, the yearly savings make it well worth it.

Who Qualifies?

MCCs usually have income and purchase-price limits and are for buyers who have not owned a home in the last three years, with exceptions for veterans and certain targeted areas. Many buyers can combine an MCC with down payment assistance.

Get the Savings Every Month

Many buyers adjust their W-4 withholding so the credit shows up in each paycheck. Talk with your tax professional about your situation.

Learn more: Texas Mortgage Credit Certificate.

Let’s Run Your Numbers

Call or text me at 281-978-2106 or get started on your pre-approval. I will show you every option side by side so you can choose with confidence.

Clifton Saunders, The Mortgage Mentor

Clifton Saunders, NMLS #230688 | New American Funding, NMLS #6606 | Equal Housing Opportunity. Subject to credit approval; not all applicants will qualify. Programs and guidelines change; call or text 281-978-2106 for current details. This article is general information, not tax or legal advice.