PHFA Mortgage Credit Certificate (MCC) Program

What is PHFA Mortgage Credit Certificate (MCC) Program?

PHFA Mortgage Credit Certificate (MCC) Program is a mortgage credit certificate for homebuyers in Statewide, Pennsylvania, administered by Pennsylvania Housing Finance Agency.

• The PHFA Mortgage Credit Certificate (MCC) Program provides eligible low- and moderate-income homebuyers a federal income tax credit on a portion of the mortgage interest they pay each year, claimed via IRS Form 8396. It is a statewide program offered in conjunction with PHFA's HFA Preferred Risk Sharing, HFA Preferred, and Keystone Government loans, and borrowers must meet Keystone Home Loan income and purchase price limits. An MCC reduces federal tax liability annually for the life of the loan.
• Annual federal income tax credit on mortgage interest.
• Reduces federal tax liability for the life of the loan.
• Statewide (target and non-target areas).
• Pairs with PHFA first mortgages.
• This is a federal program, so it is available beyond a single state or city.

Do you have to pay it back?

PHFA Mortgage Credit Certificate (MCC) Program is a tax credit rather than a loan, so there is nothing to repay.

• Forgiveness and repayment terms are set by the program and can change — confirm them on the official program page before applying.

Who qualifies?

PHFA Mortgage Credit Certificate (MCC) Program is open to first-time homebuyers and buyers who will live in the home as their primary residence.

What are the income limits?

PHFA Mortgage Credit Certificate (MCC) Program sets its income limit as follows: Borrowers must meet the Keystone Home Loan program income and purchase price limits, published as county-by-county tables in Appendix A. Available statewide in target and non-target areas.

• The limit applies to total household income, not only the borrower’s.
• Area median income figures are published by HUD and updated annually, so check the current table for the county before relying on a number.

Where does it apply?

PHFA Mortgage Credit Certificate (MCC) Program is a federal program, so it is not limited to Pennsylvania.

• The program targets specific areas: Available statewide in both target and non-target areas; targeted areas identified in Appendix A.

How do you apply?

Applications for PHFA Mortgage Credit Certificate (MCC) Program go through Pennsylvania Housing Finance Agency, which publishes the current terms and the application steps on its own site.

1. 1

   Take a homebuyer education course

   Required by the program, through PHFA-approved counseling agencies; per the underlying first mortgage program requirements..

2. 2

   Contact Pennsylvania Housing Finance Agency to reserve funds

   Funds are reserved with the provider and are subject to availability.

3. 3

   Work with a lender who handles the program

   Hey Prescott is not a lender and does not accept applications; this page describes the program so a buyer can take it to a lender or housing counselor.