First Time Buyer MCC Tax Credit for North Carolina Buyers
MCC Tax Credit – Up to $2000 Per Year!
We offer several low to no down payment options for first time buyers. Additionally, first time buyers may qualify for an MCC Tax Credit. Even other buyers on occasion! This benefit offers a true bottom line income tax credit up to $2000 each year. The tax credit enhances the affordability of a primary residence purchase in NC. So lowering income taxes makes home buying more affordable.
You Could Benefit from an MCC Tax Credit if…
- First time buyer – not owned a principal residence in 3 years
- Buying a home in North Carolina
- Purchasing a primary residence
- Under the required county household income limit
- Buying a single family detached, townhome, off-frame modular, or approved condo
So if you meet the above, make sure to ask about this tax credit. Furthermore, there are scenarios that allow exceptions to these basic guidelines! Read below for qualification.
NC Housing Finance Agency allows us to offer this great tax credit. Additionally, we also offer the NC Housing Finance Agency down payment assistance program as well.
MCC Tax Credit Program Features:
- Income limits for each NC County. Click here for the income limits.
- May combine with NC Home Advantage with down payment assistance
- Attach to USDA, VA, FHA, or conventional loans
- May lower borrower debt ratio for better qualification
- Used homes = 30% credit, New homes = 50% credit
- $775 fee charged for the tax credit. One-time fee. First year credit often exceeds the cost. Seller could even pay cost!
- $245,000 maximum purchase price
Why choose an MCC Tax Credit and Team Move OVM?
Team Move loan officers are approved and certified to offer NC Housing Finance Agency products. Therefore, our qualified buyers may take advantage of this helpful tax credit. As a matter of fact, the credit is a true bottom line dollar for dollar reduction in tax liability. As shown above, this tax credit can be up to $2000 per year. Although, the amount depends on the interest rate, loan size, and whether the house is new or used.
The formula for the annual tax credit is:
Loan amount * Interest Rate * Tax Credit Percentage = Potential Annual Tax Credit
Example using MCC Tax Credit Calculation
Scenario: First time buyer, $150,000 loan amount, sample interest rate 4.5%, previously occupied home.
$150,000 * .045 = $6750 * .30 = $2025. Maximum tax credit is $2000, so $2000 would be the tax credit.
Exceptions to the first time buyer requirement
These buyers can still receive an MCC Tax Credit! So, the first time buyer requirement could be waived if…
- Home is in a designated Targeted Area. See the targeted areas in NC here
- Buyers owned a mobile home. But the mobile home was not permanently attached
- Owners of rental property, as long as they have not lived in the property for the last 3 years
- Buyers paying off a construction loan with a term not to exceed 24 months
- A separated/divorced buyer who has not occupied the marital home within the past 3 years
- The buyer is a Veteran. Veterans must have served active duty in the US Armed Forces or Reserves. Additionally, he/she must be discharged or released under conditions other than dishonorable. Finally, there is a one-time nationwide exemption
In conclusion, our goal is to promote homeownership in NC. Therefore, we gladly offer this tax credit to qualifying buyers. Keep in mind, this tax credit is only available on a purchase. Therefore, once the home is owned, an owner may not apply for the MCC tax credit. We hope you found this helpful. So, give us a call to learn more and read other first time buyer tips below.
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