How an MCC Can Save You Money on Your First Austin Home

Mcc

Mortgage Credit Certificate

The Mortgage Credit Certificate (MCC) is an optional tax credit that income qualified first time home buyers may purchase as part of their home loan. What is it, who gets it and how do you save up to $2,000 per year over the life of the loan?

What is the MCC? The Mortgage Credit Certificate is provided by the Texas Department of Housing and Community Affairs to help make home ownership more affordable for low to moderate income groups. It targets certain housing areas, including within the City Austin.

Who can get an MCC? The scheme has the following requirements on home buyers:

  • First time homebuyers (have not owned a home in the last three years)
  • Low to moderate income. This is defined as earning a maximum of 115% or 130% of Austin Median Family Income. This qualification depends on household size, so the maximum allowable income for a family of four in Austin in 2008 is $79,465 per year.
  • Buying a home for primary personal residence
  • Must take a certified home-buyer education class before closing

How much can an MCC save? The scheme provides a tax credit of up to $2,000 per year as an offset to paid income tax. This is available for every year during the life of the loan if the home is still your primary residence. This tax credit is in addition to the regular tax deduction available to regular home owners.

How much does an MCC cost? The application fee is around $75, and the certificate costs 1% of the loan amount at closing.

Which lenders can I use to get an MCC? Only qualified lenders and loan officers can apply for the MCC on your behalf. This is a list of MCC approved lenders, or I could introduce you to some that I have worked with recently who provide excellent service.

The MCC is a great way for income qualified applicants to receive additional tax benefits for the life of their loan.

Contact an Austin Realtor if you have questions about the MCC and how it can save you money on your home purchase. 512 215 4785

University Hills – One Thing Every Home Buyer Should Ask

East Austin – You wouldn’t build a home without first putting down a solid foundation would you? It’s a phrase people bandy about with reckless abandon to illustrate their points about putting the groundwork in first. And in East Austin Realtor circles, and those who know University Hills in particular, you’ll often here the question asked – has it had any foundation work done?

Three little piggiesJust as the three little piggies learned their lesson about building material choice through multiple iterations of house manufacture, so the builders of the latter part of the 20th Century learned about the best way to prepare and pour a slab foundation. In University Hills, the two major builders were Bill Milburn and Walter Carrington, and through the 1960s and 1970s, they built large ranch-style houses amid the hills of 78723.

The challenge homeowners in the area have is that the homes were often built on absorbent clay soils, which swell when wet and contract in the dry summers of Austin. As they do so, the slabs that rest upon them rise and fall, often at different levels in different parts of the house, leading to an unlevel foundation. Which means that foundation leveling companies like Centex and LevelBest earn a living shoring up the foundations, returning the floor to level, and hopefully preventing any future deviations.

So what do you need to know when considering buying a home in University Hills? Has the foundation been levelled? It’s a subject of debate as to whether a foundation that hasn’t moved in 50 years is better than one that has and has been repaired. I advocate that there’s only real value in a foundation repair from a reputable company which offers a lifetime warranty. If there has been repair there are follow up questions – where is the engineer’s report to validate the work?, and is there a transferable lifetime warranty? Digging down further, the engineer may have recommendations about drainage, grading and gutters, so you need to ask if these have been followed.

A buyer’s inspector should check for signs of foundation movement, and recommend inspection by a levelling company as further due dilligence if necessary. These companies typically measure vertical deflection at different points in the home and express a judgment if any deflection is out of typical acceptable tolerance. If you are buying with an FHA loan, then the FHA appraiser will have an acceptable tolerance, and may ask for further investigation from a structural engineer which might cost $400+ for a report.

So the upshot is: if you’re buying in the area, make sure you do your due dilligence. If you’re selling in the area, get this checked out before you get on the market.

Garreth Wilcock used to live in University Hills, where he learned the hard way about choosing a foundation repair company that will still be in business when it’s time to sell your house. He helps people buy and sell homes there. 512 215 4785.

Garreth Wilcock is a licensed REALTORĀ® in the State of Texas with Keller Williams Realty.
All information provided is deemed reliable but is not guaranteed and should be independently verified. Properties subject to prior sale or rental