New, Higher Income and Sales Price Limits Open Mortgage Savings Program to More Alabama Home Buyers

MONTGOMERY, Ala. – The Alabama Housing Finance Authority (AHFA) has opened its popular Mortgage Credit Certificate (MCC) program to more homebuyers, thanks to newly increased income and sales price limits.

Set by the U.S. Department of Housing and Urban Development, the new income limits increased over 2022 figures by as much as 8.2 percent due to increasing median incomes and economic gains. Qualifying households now can earn up to $111,440 annually, depending on the home’s location and family size.

The changes benefit participants in the MCC program, available to Alabama homebuyers only through AHFA. The MCC gives homebuyers an annual credit to reduce federal income tax. The credit is equal to a percentage of mortgage interest paid for every year of the life of the loan. The remaining annual interest can still be claimed as a mortgage interest deduction on the homebuyer’s federal tax return.

Designed to make homeownership more affordable, the program is not as complicated as it sounds, said AHFA Single-Family Administrator Carrie Hamaker.

“Taking advantage of the MCC can save homebuyers hundreds of dollars per month, and literally thousands of dollars on their tax bills each year. That savings frees up income so they can qualify for a nicer home,” said Hamaker. “More than 4,000 Alabama households have already used this federal incentive to boost their purchasing power.”

The maximum sales price for the home purchase has risen as well, to $588,104 in “target” areas and $481,176 in “non-target” areas. These areas are set by the federal government to encourage economic development. AHFA will verify each property’s location and apply the appropriate limit on an individual basis.

MCCs may be combined with up to $10,000 in AHFA-administered Step Up down payment assistance or any other 30-year, fixed-rate, amortizing conventional, FHA, VA, Rural Development, or privately insured mortgage. Applications are accepted on a first-come, first-served basis by a statewide network of more than 60 participating lenders.

Other parts of the state, both rural and urban, have their own income limits based on each area’s median income. Visit www.ahfa.com/homebuyers/programs-available/mccs/income-limits for a complete listing.

For more information, call AHFA at 800-325-2432 or visit www.ahfa.com/homebuyers/programs-available/mccs.

AHFA, established in 1980 by an act of the Alabama Legislature, is a self-supporting public corporation dedicated to meeting the housing needs of the state’s low- to moderate-income citizens. Its programs have provided opportunities for more than 200,000 families to live in homes they can afford.