Mortgage Credit Certificate

Rates by Mortgage Amount Mortgage Credit

Mortgage Tax Credit
Amount Rate Certificate
$50,000 and less 35%
$50,001 to $70,000 30%
$70,001 to $90,000 25%
$90,001 and more 20%

Can You Afford To Turn Down

An Extra $135 Per Month?

If you’re planning to purchase your first home, the Indiana

Housing and Community Development Authority can help
you put money back in your wallet or pocketbook with a Ho-
meownership Tax Credit (also known as a federal Mortgage
Credit Certificate, or MCC).

Here’s how the Homeownership Tax Credit works. You ob-

tain a mortgage through a participating lender. In addition
to your mortgage, you will receive a certificate that offers
you a federal tax credit of up to $2,000 per year. A tax cred-
it is more valuable than a tax deduction because it lowers
your actual tax liability, rather than your taxable income.

The size of your Homeownership Tax Credit will vary

based upon your mortgage amount. On a $60,000 loan,
you will receive a credit of 30 percent of the interest that
you pay. For example, if your mortgage’s annual interest
rate is 9 percent, you will pay $5,383 in interest during
the first 12 months and will receive a Homeownership Tax
Credit worth $1,615. This averages out to approximately
$135 per month.
What Is The Purpose of the
Homeownership Tax Credit?
Indiana’s Mortgage Credit Certificate (MCC), was created
in 1987 to benefit middle and lower-income home buyers.
Administered by the Indiana Housing and Community
Development Authority, the Homeownership Tax Credit al-
lows qualified home buyers to lower their federal income
tax liability for as long as they hold the original mortgage
on their home (up to 30 years).
The purpose of this program is to make home ownership
more affordable for first-time buyers. This program was
designed to provide the consumer with as much flex-
ibility as possible, since it may be applied to all types
of loans (fixed-rate, adjustable rate, conventional, FHA,
VA, etc.).
Federal law does not allow the mortgage credit certificate
to be used in conjunction with a mortgage financed by
IHCDA’s low-interest 1st HomePlus. But, the mortgage
credit certificate can be packaged with other competitive
mortgage products, such as zero down-payment loans
offered by the Farmers Home Administration (FmHA) to
citizens in smaller communities. In metropolitan, areas
some home builders may help you reduce up-front ex-
penses by paying a portion of your closing costs, or your
1% application fee.
Who Qualifies for Credit?
To qualify for this credit, your household income must be
below certain limits, which vary by county. Please visit
our Web Site at www.indianahousing.org .
What Is The Credit Amount?
Your Homeownership Tax Credit amount will range
between 20 percent and 35 percent of the interest that
you pay on your mortgage each year, depending on the
mortgage loan amount. The maximum credit per year is
$2,000. Since your interest payments change overtime,
your credit also will vary from one year to the next.
How Does The Process Work?
Step 1- Meet with a participating lender who can help you
determine whether you may qualify for a Homeowner-
ship Tax Credit based on your household income and the
purchase price of the home you plan to buy.
Step 2- If you believe you qualify, contact a profes-
sional tax consultant or accountant who can help you
make the most effective use of your tax credit. Internal
Revenue Service literature references the Homeowner-
ship Tax credit program as Mortgage Credit Certificates
or MCCs.
Step 3 – When you apply for a mortgage, tell your partici-
pating lender that you also would like to apply for a MCC
tax credit. The application fee is equal to one percent of
your mortgage loan amount.
Step 4 – Prior to your mortgage closing, be sure that
your lender has preliminary approval for your credit from Can I Qualify For A Credit If I Already Own A
IHCDA. After closing, you will receive a certificate con- Home?
firming your credit.
Homeownership Tax Credits cannot be applied to existing
Step 5 – Take your certificate and your information sheet mortgages. Although the tax credit program was created
from IHCDA to your tax advisor and ask about adjusting primarily to assist first-time buyers, the federal govern-
your 1040’s. ment has agreed to waive this requirement in certain
targeted communities. The targeted areas include the
following 30 counties:
Brown, Clinton, Crawford, Daviess, Dearborn, Decatur, Fayette,
Franklin, Fulton, Greene, Jackson, Jasper, Jefferson, Knox,
Lawrence, Miami, Ohio, Orange, Owen, Parke, Perry, Pike, Rush,
Scott, Shelby, Spencer, Vermillion, Vigo, Washington, Wayne.
The first-time requirement also is waived in portions of the
following cities. Fort Wayne, Gary, Hammond, Anderson,
Indianapolis, Bloomington, South Bend, Lafayette/West
Lafayette and Evansville.
If you are interested in purchasing a home in a targeted area,
you still will have to meet household income and purchase
price requirements. Participating lenders maintain informa-
tion that explains which portions of the cities are targeted.
 County Census Tract
Allen 0006.00 00113.03 0023.00 0017.00 0014.00
0015.00 0012.00 0035.00 0027.00 0018.00
0020.00 0016.00 0013.00 0042.00 0028.00
0029.00 0010.00 0011.00
Bartholomew 0101.00
Delaware 0001.00 0019.01 0007.00 0009.02 0004.00
0006.00 0002.00 0003.00 0010.00
Elkhart 0026.00 0028.00
Floyd 0708.01
Grant 0002.00
Henry 9763.00
Howard 0002.00 0012.00
Jefferson 0002.00 0065.00 0049.00 0028.00 0015.00
0010.00 0003.00 0056.00 0041.00 0023.00
0017.00 0011.00 0066.00 0050.00 0030.00
0024.00 0018.00 0004.00 0059.00 0043.01
0035.00 0027.00 0014.00 0128.02 0051.00
0053.00 0037.00 0021.00 0006.00 0062.00
0043.02
Knox 9550.00 9553.00 9554.00
Lake 0102.02 0310.00 0206.00 0122.00 0113.00
0105.00 0102.03 0302.00 0207.00 0119.00
0109.00 0106.00 0103.01 0303.00 0123.00
0114.00 0110.00 0107.00 0103.02 0218.00
0120.00 0116.00 0111.00 0117.00 0304.00
0127.00 0301.00 0108.00 0121.00 0204.00
LaPorte 0401.00
Madison 0005.00
Marion 3226.00 3308.01 3572.00 3551.00 3532.00
3426.00 3501.00 3601.01 3564.00 3539.00
3507.00 3508.00 3412.00 3573.00 3547.00
3511.00 3512.00 3503.00 3601.02 3556.00
3517.00 3521.00 3509.00 3416.00 3569.00
3535.00 3528.00 3515.00 3504.00 3574.00
3542.00 3557.00 3523.00 3510.00 3603.02
3548.00 3544.00 3531.00 3516.00 3545.00
3571.00 3550.00 3536.00 3505.00 3559.00
3581.00 3527.00 3533.00
Monroe 0001.00 0002.01 0002.02 0003.01 0016.00
0006.00 0009.01
St. Joseph 0006.00 0001.00 0010.00 0009.01 0019.00
0020.00 0021.00 0017.00 0023.00 0027.00
0029.00 0028.00
Tippecanoe 0004.00 0006.00 0053.00 0105.00 0055.00
0054.00 0103.00
Vanderburgh 0012.00 0020.00 0018.00 0014.00 0026.00
0017.00 0013.00 0021.00 0019.00
Vigo 0001.00 0003.00 0005.00 0019.00 0006.00
0008.00 0002.00
Wayne 0002.00