Alabama Mortgage Credit Certificate Program Checklist
A step-by-step checklist for consumers applying for the Alabama Mortgage Credit Certificate Program.
Check Eligibility
- Confirm you are a first-time homebuyer, meaning you have not owned a home in the last three years. Exceptions may apply for targeted areas or qualified veterans.
- Verify that your household income falls below the program's limits, which vary based on family size and county. Refer to the program's income chart for specifics.
- Ensure your credit score meets the minimum requirement, typically at least 640, though lenders may have stricter criteria.
- Confirm the property meets program price limits and will serve as your primary residence. Certain property types, like vacation homes or investment properties, are ineligible.
- Check if you meet additional requirements, such as being a U.S. citizen or permanent resident.
Gather Required Documentation
- Collect proof of income, such as recent pay stubs, W-2s, or other documents showing your earnings.
- Prepare tax returns for the past two years, including all schedules and supporting documents.
- Obtain bank statements from the past two to three months to demonstrate financial stability.
- Secure documentation related to your desired property, including the address, purchase agreement, and property price.
- If applicable, include any other documents requested by your lender, such as proof of additional assets or liabilities.
Loan Officer Assignment
- A Loan Officer has already been assigned to assist you with the MCC Program.
- Reach out to your assigned Loan Officer to schedule a meeting or call for further guidance.
- Discuss eligibility requirements, gather any additional documentation, and clarify the next steps.
Complete the Application
- Work closely with your assigned Loan Officer to complete the MCC application.
- Submit all required documents, ensuring they are accurate and up to date.
- If necessary, attend a homebuyer education course as required by the program or lender.
- Review the application with your Loan Officer to ensure there are no errors or missing information before submission.
Final Steps After Approval
- Review and sign all loan and program-related documents provided by your Loan Officer to finalize the process.
- Prepare to pay any upfront fees or closing costs associated with the MCC program. Ensure you understand which costs are covered and which are not.
- Receive confirmation of your MCC certificate and understand how to use it for claiming tax credits on your mortgage interest.
Maintain Eligibility for the Tax Credit
- Continue using the property as your primary residence to remain eligible for the MCC tax credit.
- File IRS Form 8396 with your annual tax return to claim the mortgage interest tax credit.
- Notify your Loan Officer or the MCC program administrator if you plan to sell, refinance, or make significant changes to your mortgage to understand how it affects your tax credit.
- Stay updated on any changes to program requirements or limits to ensure continued compliance.