How to Get a Mortgage Credit Certificate

A Mortgage Credit Certificate (MCC) is a federally created tax subsidy for residents of Hawaii. This certificate helps borrowers by giving them a direct tax credit for interest paid on a first mortgage. MCCs were created in 1984 after the passage of the Tax Reform Act. To receive one of these certificates, you need to meet certain requirements, both before and after funding a mortgage.

Make sure you are purchasing a new home and not refinancing an existing mortgage. MCCs are only granted to first-time homeowners who will use the home as their primary residence--not as a rental property.

Ensure that you have not owned another residential property for the past three years. If you've had any mortgage (even as a vested owner) in the three years previous to your MCC application, you will be disqualified.

Find a lender who issues MCCs. Lenders in Hawaii are not forced to participate in the program, so you must find one that opts to enroll in the tax reform policy. See Resources for a list of lenders who participate.

Make sure your property fits the mortgage balance requirement. For example, if you will be purchasing the home in Honolulu, your mortgage balance cannot exceed $644,429.

Make sure your income qualifies you for a MCC. For example, if you are part of a family of three in Honolulu, the maximum family income you can generate is $108,220. See Resources for a list of eligible incomes.

Apply for a mortgage with a MCC-certified lender. The MCC application will be a part of the loan process.