Mortgage Credit Certificates (MCCs) issued through NC Housing may qualify a Veteran for a Federal tax credit. The Federal tax credit is based on a certain percentage of the Veteran’s mortgage interest payment.
The Veteran’s Tax credit with the MCC is limited. If the percentage on the MCC is more than 20 percent, there is an annual limit on the tax credit equal to the lesser of $2,000 or the borrower’s maximum tax liability.
VA Loan Mortgage Credit Certificate
Example: The Veteran’s taxes show that they are being taxed at a rate of 30-percent, and the loan is $100,000. The borrower will pay approximately $4,000 in annual mortgage interest, if the mortgage rate is 4.0% . Let’s say that the Veteran’s estimated total Federal income tax liability is $9,000. Calculate the tax credit as follows:
- 30 percent of $4,000 = $1,200
- Apply the annual $2,000 limit
- The tax credit will be $2,000
- Use $167 (one-twelfth of $2,000) in the monthly analysis
Okay – so what does this mean to you if you are a Veteran in NC??? It means that there’s a First Time Home Buyer program that allows for 640 credit scores and will give you a tax credit! You will be bringing home MORE money so that you can qualify to afford your home!
Want to buy a house in NC and use your VA Loan benefits? Call Steve and Eleanor Thorne 919 649 5058. We genuinely appreciate your service, and we are so proud to be able to help! Did you know that you can get your VA Eligibility reinstated?