The Welcome Home Heroes homebuyer financing package includes:
• a $10,000 forgiveable loan over two years for down payment and closing cost assistance
• a 30-year fixed rate mortgage that has an affordable interest rate
• an optional mortgage credit certificate to reduce federal income tax liability.
• Veterans (who need not be first-time homebuyers)
• Active military personnel, reservists and Illinois National Guard members (must be first-time homebuyers)
• Buyers must qualify based on income and purchase price limits. Rock Island county limit for a single family home is $250,200. Rock Island county income limit is $72,100 for a household up to 2 people and $82,915 for a household over 3 people.
How to apply
Interested buyers must apply through a lender in their area. The program only applies to 1-2 unit residential properties in the State of Illinois purchased as a primary residence. The new loan builds on the existing affordable home loan, SmartMove, also available through IHDA's lenders.
How does the tax credit work?
A mortgage credit certificate (MCC) enhances the benefit of the federal homeowner mortgage interest deduction. Homeowners with the credit are allowed to use 20 percent of their annual mortgage interest as a direct federal tax credit, resulting in a dollar-for-dollar reduction of their annual federal income tax liability. The remaining 80 percent of their annual mortgage interest will continue to qualify as an itemized tax deduction.
Based off a $150,000 loan with a four percent interest rate:
Without MCCWith MCC
|Mortgage interest deduction
$4,762 (80 percent of $5,952)
|Taxes paid @ 15 percent tax bracket
|MCC tax credit
$1,190 (20 percent of $5,952)
|Income tax due
For more information go to Illinois Housing Development Authority