Even More Tax Money Available

By now we’ve all heard about the Homebuyer Tax Credit. We may not know all the ends and outs about it (our friends and family members have gotten the scoop), but we know there is an opportunity to save some money for the right people. But were you aware that there are other programs out there that can save you even more money when purchasing a home. Some programs require you to purchase in specific areas of Houston, some are good throughout Harris County. There is an additional tax credit available that I’d like to tell you about.

An Additional Tax Credit

There is an additional tax credit available to first time home buyers known as the Mortgage Credit Certificate offered through the state of Texas. For the purpose of this tax credit a first time homebuyer is defined as a borrower who has not owned a property for at least three years. This money can be used in conjunction with the Homebuyer Tax Credit.

Summary of the program

The Mortgage Credit Certificate is an “add on” to any conventional, VA, or FHA loan. It is made up of bond money that is allocated at the beginning of the calendar year and is awarded on a first come, first serve basis. Once the funds have been exasperated, additional funds will not be available until the beginning of the following year.

Along with being a first time homebuyer, there are additional conditions that must be met in order to qualify for the credit. The borrower must complete a first time homebuyer class. This class can be taken correspondently, for free, at the learning center on the MGIC website.

There are also income limits that apply. 1-2 family households limit: $76,560 and $89,230 for 2-3 people. Household refers to the borrowers named on the loan. A $75 application fee must be sent to Austin with the appropriate forms to get the ball rolling.

What does all of this get me?

The size of the annual tax credit will be 30% of the annual interest paid on the mortgage loan. However, the maximum amount of the tax credit shall not exceed $2,000 per year. What’s the catch? The buyer must maintain the mortgage for at least 9 years or possibly face recapture of the credit. This document will explain more about the recapture process.

Only certain lenders are approved to offer this additional tax credit and, of course, we work with several that are the best of the best. If you have more questions about this or any other loan programs available just give me a shout at 832-722-7731.

Stacy is a licensed REALTOR® and the team leader of The Jones Team, a group of residential real estate agents who work together to provide exceptional service for their clients. Stacy and his team specialize in the areas west of downtown Houston. These incredible real estate agents can help you buy or sell a home in locations such as Katy, Cypress, far West and Northwest Houston, Richmond, Fulshear, Sugar Land, Spring Branch, Memorial, Spring, Tomball, The Woodlands, and Magnolia. Whether you are in the market to sell a home, buy a home, or just have real estate related questions, Stacy and The Jones Team are available to help.