Washington Home Advantage MCC Program Guide

Guide to the Washington Home Advantage MCC Program

The Washington Home Advantage MCC Program offers eligible homebuyers significant tax savings through a Mortgage Credit Certificate (MCC). This program is designed to make homeownership more affordable by providing a dollar-for-dollar reduction in federal income tax liability, based on a percentage of the mortgage interest paid. Below is a comprehensive guide to the program’s features, requirements, and application process for 2025.

1. Program Overview:

• Purpose: The MCC Program helps reduce the cost of homeownership by providing a federal tax credit based on a portion of the annual mortgage interest paid by the homeowner.
• Tax Credit Amount: Buyers can claim up to 20-25% of their annual mortgage interest as a federal tax credit, with a maximum cap of $2,000 per year.
• Long-Term Savings: The MCC is valid for the life of the mortgage, as long as the home remains the buyer’s primary residence.

2. Eligibility Requirements for 2025:

To qualify for the Washington Home Advantage MCC Program, applicants must meet the following criteria:

• First-Time Homebuyer: The program is primarily for first-time buyers, defined as individuals who have not owned a home in the past three years. Exceptions may apply for buyers in targeted areas or veterans.
• Income Limits: Household income must fall within program limits, which vary by location and household size. These limits are updated annually.
• Property Requirements: The home must be located in Washington, used as the buyer’s primary residence, and meet program purchase price limits.
• Loan Requirements: The MCC must be issued alongside a new mortgage loan and cannot be applied to refinancing an existing loan.
• Homebuyer Education: Completion of an approved homebuyer education course is required to ensure buyers understand the responsibilities of homeownership and the benefits of the MCC.

3. How to Apply:

Follow these steps to apply for the Washington Home Advantage MCC Program:

• Assigned Loan Officer: Once you begin the application process, a loan officer will be assigned to assist you. They will explain the program’s benefits, verify your eligibility, and guide you through the application process.
• Prepare Documentation: Gather necessary documents, including proof of income, tax returns, and property details.
• Submit Your Application: Work closely with your assigned loan officer to complete and submit the application. They will process the information and notify you of approval status.

4. Key Features of the MCC Program:

• Tax Credit Savings: The MCC provides up to $2,000 in annual federal tax savings, reducing the homeowner’s overall tax liability and making homeownership more affordable.
• Lifetime Benefit: The tax credit remains valid for the entire term of the mortgage, as long as the home is the buyer’s primary residence.
• Combination with Other Programs: The MCC can be paired with other Washington State Housing Finance Commission programs to maximize affordability and financial benefits.

5. Homebuyer Education Course:

• Mandatory Requirement: All applicants must complete an approved homebuyer education course. This ensures buyers are well-prepared for the responsibilities of homeownership and understand how to utilize the MCC effectively.
• Course Availability: The course is available online or in person. Upon completion, participants receive a certificate that must be included with their application.

6. Finalizing the Process:

• Approval and Certification: Once approved, your assigned loan officer will guide you through the issuance of the Mortgage Credit Certificate and explain how to claim the tax credit.
• Tax Filing: To utilize the MCC, homeowners must include the credit information on their annual federal tax return. Your loan officer will provide guidance on this process.

The Washington Home Advantage MCC Program is an excellent option for eligible homebuyers, offering substantial tax savings that make homeownership more affordable. By reducing federal tax liabilities and combining with other housing programs, the MCC helps Washington residents achieve their homeownership goals. Start your journey with the Washington Home Advantage MCC Program in 2025.