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New Hampshire Mortgage Credit Certificate (MCC) Program

The New Hampshire Mortgage Credit Certificate (MCC) Program, administered by New Hampshire Housing, helps eligible homebuyers reduce their federal income tax liability on mortgage interest payments. This program provides substantial tax savings, making homeownership more affordable for residents across New Hampshire.

Benefits

  • Allows eligible homebuyers to claim a federal tax credit of up to 30% of annual mortgage interest paid, with a maximum benefit of $2,000 per year.
  • Provides ongoing tax savings for the life of the mortgage as long as the property remains the buyer’s primary residence.
  • Can be combined with other New Hampshire Housing programs, such as down payment assistance or fixed-rate mortgages, for additional financial support.
  • Supports first-time homebuyers and individuals purchasing in federally designated targeted areas.

Eligibility Requirements

  • Applicants must meet income limits, which vary based on household size and the location of the property within New Hampshire.
  • The property must be located in New Hampshire and used as the buyer’s primary residence.
  • Applicants must be first-time homebuyers or individuals who have not owned a home in the past three years, unless purchasing in targeted areas.
  • A minimum credit score of 640 is required, with lender-specific underwriting criteria also applicable.
  • Participants must complete a New Hampshire Housing-approved homebuyer education course to prepare for the responsibilities of homeownership.

Additional Information

The New Hampshire Mortgage Credit Certificate (MCC) Program is a valuable tool for homebuyers looking to reduce the cost of homeownership through tax savings. By offering targeted financial benefits, the program empowers eligible buyers to achieve stability and build long-term equity. Administered by New Hampshire Housing, this initiative promotes sustainable homeownership and strengthens communities throughout the state.

Frequently Asked Questions About Our Program

What is the New Hampshire Mortgage Credit Certificate (MCC) Program?

The New Hampshire Mortgage Credit Certificate (MCC) Program provides eligible homebuyers with a federal tax credit that reduces their annual income tax liability, making homeownership more affordable.

Who qualifies for the MCC Program?

The program is available to first-time homebuyers, veterans, and repeat buyers in targeted areas who meet income, credit, and property eligibility requirements.

How does the MCC Program work?

The MCC Program allows eligible homeowners to claim a federal tax credit of up to 20% of their annual mortgage interest paid, directly reducing the amount of taxes owed.

How much is the tax credit under the MCC Program?

The tax credit is typically 20% of the annual mortgage interest paid, with no cap on the interest amount but a maximum credit of $2,000 per year.

Is the MCC a one-time benefit or ongoing?

The MCC provides an ongoing tax credit for the life of the mortgage as long as the homeowner occupies the home and pays mortgage interest.

Are there income limits for the MCC Program?

Yes, income limits apply and vary based on household size and the property’s location. These limits are updated annually to reflect market conditions.

What types of properties are eligible for the MCC Program?

Eligible properties include single-family homes, condominiums, and townhouses. Manufactured homes may qualify if they meet program guidelines and are permanently affixed to a foundation.

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What is the maximum purchase price allowed under the MCC Program?

The maximum purchase price is typically $400,000, though this may vary in targeted areas or for specific property types.

Can the MCC Program be combined with other assistance programs?

Yes, the MCC can often be combined with other state or local assistance programs, such as down payment assistance, to provide additional financial benefits.

Is homebuyer education required for the MCC Program?

Yes, completing a homebuyer education course is required to ensure buyers are well-prepared for the responsibilities of homeownership and understand how to maximize the program’s benefits.

Can the MCC Program be transferred to another property?

No, the MCC is tied to the original mortgage and property. If the homeowner refinances or moves, the certificate cannot be transferred.

What happens if I sell my home before paying off the mortgage?

If you sell the home within the first nine years, you may be subject to a federal recapture tax. The amount depends on factors such as income growth and the profit from the sale.

How do I claim the MCC tax credit?

Homeowners can claim the MCC tax credit by completing IRS Form 8396 and submitting it with their federal income tax return each year.

Does the MCC affect my ability to deduct mortgage interest?

No, homeowners can still deduct the remaining mortgage interest on their federal tax return in addition to claiming the MCC tax credit.

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What is the cost to participate in the MCC Program?

There may be a one-time issuance fee or administrative cost for obtaining the MCC. Buyers should verify the specific cost with their lender.

Are there location restrictions for the MCC Program?

Yes, the property must be located in New Hampshire, and additional guidelines may apply based on whether the property is in a targeted or non-targeted area.

Can the MCC Program be used to refinance an existing home?

No, the MCC Program is only available for first-time loans used to purchase a home and does not apply to refinancing.

What are the benefits of the MCC Program?

The program provides a significant tax credit that reduces the cost of homeownership over time, making it more affordable for eligible buyers.

Does the MCC expire or end after a certain time?

The MCC remains valid for the life of the mortgage, as long as the homeowner occupies the home and pays mortgage interest.

Can the MCC tax credit be carried forward if unused in a year?

Yes, any unused portion of the MCC tax credit can typically be carried forward for up to three years to offset future tax liabilities.

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