MCC Program - Affordable Housing Office of (DEP)

9/25/2009

The County has been awarded a new MCC Allocation. The allocation is expected to last 2 months and should serve 65-70 households.

The County will accept MCC applications beginning on

Monday, September 28th, 2009

until all the MCC allocation is issued.

The County is not familiar if the MCC can be used in conjunction with the IRS $8,000 first-time homebuyer credit. Please consult a tax accountant. You can also get information from IRS Tax Form 5405 for more information. Visit www.IRS.gov to download the tax form.

Program Description
The Mortgage Credit Certificate Program (MCC), authorized by Congress in 1984, provides financial assistance to first-time homebuyers. The Santa Clara County MCC tax credit reduces the federal income taxes of qualified Borrowers purchasing qualified homes; thus having the effect of a mortgage subsidy. The current tax credit rate is up to 15%. The MCC will reduce the amount of federal income taxes otherwise due to the federal government from the Borrower; however, the mortgage tax credit cannot be claimed as a refund. MCC Borrowers may consider adjusting their federal income tax withholdings so as to benefit on a monthly basis from the MCC.

MCC Program Participating Jurisdictions

Participating Cities Include:

Campbell, Cupertino, Gilroy, Los Altos, Los Gatos, Milpitas, Morgan Hill, Mountain View, Palo Alto, San Jose, Santa Clara, Sunnyvale, and the unincorporated areas of the County.

Income Limits for 2009

Effective February 6, 2009, the maximum gross income limits are as follows:

1 or 2 person household=$97,800 Low-income maximum = $63,300
3+ person household= $112,470 Low-income maximum = $72,795

*Note: Target Area in downtown San Jose has different limits.

Home Purchase Price Limits for 2009

Existing (Resale) Property=$570,000
New Construction Property=$630,000

*Note: Target Area in downtown San Jose has different limits.

MCC Application Process
Borrowers go through the "normal homebuying process" in which the Borrower would contact a real estate agent or broker to search for a home. The borrower then applies for a mortgage loan from a Participating Lender or Broker who is trained to answer all of the borrower's questions about the MCC Program. For a list of County approved MCC Brokers and Lenders scroll to bottom of page under ATTACHMENTS. The originating loan agent will determine if the borrower is eligible for an MCC, based on the Maximum Income Limits for the MCC Program Maximum purchase price limits, prior home ownership, location of residence to be purchased, and potential tax liability. If the Borrower meets the County MCC guidelines, the Lender directs the Borrower to sign the initial application documents. The Borrower remits the non-refundable application fee of $275 to the lender. Of that fee, $200 is submitted by check to the County of Santa Clara with the initial phase of the MCC application.