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More homebuyers are eligible for AHFA's popular Mortgage Credit Certificate (MCC) program, thanks to increased income and sales price limits.
Set by the U.S. Department of Housing and Urban Development, the new income limits rose over 2022 figures by as much as 17 percent due to growing median incomes and economic gains. Qualifying households now can earn up to $119,400 annually, depending on the home’s location and family size.
The MCC gives homebuyers an annual credit to reduce federal income tax. The credit is equal to a percentage of mortgage interest paid for every year of the life of the loan. The remaining annual interest can still be claimed as a mortgage interest deduction on the homebuyer's federal tax return.
Designed to make homeownership more affordable, the program is not as complicated as it sounds, said AHFA Single-Family Administrator Carrie Hamaker.
“Taking advantage of the MCC can save homebuyers hundreds of dollars per month, and literally thousands of dollars on their tax bills each year. That savings frees up income so they can qualify for a nicer home,” said Hamaker. “More than 4,000 Alabama households have already used this federal incentive to boost their purchasing power.”
The statewide maximum sales price for the home purchase has risen as well, to $588,104 in “target” areas and $481,176 in “non-target” areas. These areas are set by the federal government to encourage economic development. AHFA will verify each property’s location and apply the appropriate limit on an individual basis.
MCCs may be combined with up to $10,000 in AHFA-administered Step Up down payment assistance or any other 30-year, fixed-rate, amortizing conventional, FHA, VA, Rural Development, or privately insured mortgage. Applications are accepted on a first-come, first-served basis by a statewide network of more than 60 participating lenders.
Income limits are based on each area’s median income. Visit MCC Income Limits for a complete listing.
For more information on the MCC program, call AHFA at 800-325-2432 or click here.
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