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Mortgage Credit Certification Program

The MCC helps you buy a home by:

  • Increasing the loan amount a home buyer qualifies for;
  • Entitling the home buyer to take a federal income tax credit of 20 percent of the annual interest paid on the mortgage used to buy the home;
  • Increasing buyer income and buyer ability to qualify for the mortgage plan;
  • Reducing the amount of federal income taxes paid to the federal government;
  • Providing a tax deduction that is subtracted from the adjusted gross income before federal income taxes are computed;
  • Allowing the home buyer to file a new W-4 form with his/her employer reflecting the MCC credit savings. This increases the number of exemptions and reduces the amount of taxes withheld and increase the buyer's disposal income;
  • Allowing the home buyer to also wait until the end of the year and realize the tax credit savings in one lump sum when filing the federal income tax return.

Program requirements

  • First time home buyers;
  • Home buyer cannot have ownership interest in a principal residence in the last three years;
  • Home buyer must occupy the home as a principal resident.

Eligible properties

  • New or previously occupied single-family homes, including single-family detached homes, condominiums, half-plexes, owner occupied duplexes or townhouse in the cities of Carlsbad, Coronado, El Cajon, Encinitas, Escondido, Imperial Beach, La Mesa, Lemon Grove, National City, Poway, San Marcos, Santee, Vista and the unincorporated areas of San Diego;
  • Triplexes or four-plexes do not qualify as eligible structures for this program.

Steps to apply for an MCC

  • Obtain list of participating lenders from the SDRMCCP Office, 619-469-0270.
  • Apply for MCC when applying for a mortgage loan;
  • Buyer should have a purchase offer in hand and should be ready to supply credit information, employment data and other information for both the mortgage and the MCC applications;
  • Lenders work with borrowers on a first-come, first-served basis;
  • During the mortgage process, the lender submits a MCC application;
  • If eligible, the SDRMCCP provides a MCC commitment to the lender which reserves a MCC for that purchase transaction;
  • MCC is issued at close of escrow.

The MCC recapture tax

Recipients of MCC may be subject to recapture tax if they sell their residence within nine years.