A Retirement Resources Blog for Seniors and Retirees – HOME

Amongst the bewildering amount of information about tax credit loan entitlements, there are nuggets of information that can greatly increase your ability to sell your home faster and make your move to Wesley Homes Retirement Community to benefit your quality of life.  

One need only read the Seattle Times article “First-time buyers benefit from prices, choices, tax credits” to understand that the new loan entitlement programs are “game-changers” in the home buying and selling strategies.  

However, newspaper articles are necessarily broad in scope and therefore it helps to distill the information down to the points that benefit the Wesley Homes audience; seniors and their adult children who could benefit from the creative solutions that the tax credit programs provide. 

Family Buy/Sell Strategies

For example, if you desire to keep the family homestead and it appeals to you to help other family members qualify to buy your home, then these tax credit programs could be the edge that gives you and your family members a leg up in this economy. 

If your asking price is $400,000 or less, marketing your home with a Mortgage Credit Certificate (MCC) is literally a ‘deal maker’ for both the buyer and the seller,” says Paul Scobee who teaches the First Time Home Buyer Seminars for the Washington State Home Finance Commission. 

 “If a buyer doesn’t make enough money to buy the home, they very well could if they had an MCC,” said Scobee, “so regardless of whether the buyer is family or not, the MCC increases the seller’s pool of prospective buyers.”  

Loan Entitlements You Never Heard Of

“Mortgage Credit Certificate” or MCC, is a Federal Program to assist “First Time Home Buyers” in purchasing a home.  The program allows a home owner to take a credit, of up to 20% of their annual mortgage interest, off their “tax liability” or tax bill.   

The MCC entitlement reduces by several hundred dollars a month the monthly payment figure banks use to figure a buyer’s income to debt ratio (PITI).  “It’s not unusual for a buyer to qualify for $50,000 more by qualifying for an MCC,” said Scobee, “That can mean the difference between buyers qualifying for a $400,000 vs. a $340,000 home”.  

Casey, a creative marketing professional who recently bought her first home in Issaquah, WA, is typical of the young, single professionals who benefit financially by qualifying for both the First Time Buyer and a MCC.  

The First Time Buyer Program now applies to anyone who hasn’t owned a home for three years — an expansion on the definition of “first-time” that makes the program accessible to many more people. 

Market Your Home With The MCC Entitlement

As a home owner you start with an analysis of your home in regards to all entitlement programs that help buyers qualify to buy your home.  For example, a savvy realtor will market your home with the MCC entitlement. 

This requires advice from a realtor or loan officer who specializes in government assisted entitlements; one who can demonstrate their experience helping buyers qualify for these entitlements.   

“It was the First Time Buyer entitlement that really got me thinking,” said Casey, “but the MCC entitlement is actually better because the First Time Buyer $8,000 entitlement is a onetime thing and the MCC qualifies you to get a dollar for dollar tax credit for the life of the loan.” 

“If you break it out monthly,” said Casey, “for me it’s hundreds of dollars a month I save in tax credits.  If you qualify for the MCC, the mortgage company and the bank apply for you.  The only requirement is that you attend a class on home buying which was informational.”  Scobee taught the seminar Casey attended.  To find out about the seminars, go to www.wshfc.org.
 

–ilenelittle for Wesley Homes

This entry was posted on Tuesday, December 8th, 2009 at 7:11 am and is filed under Active Retirement Communities, Time to Retire?. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.