Mayor Newsom & Supervisor Carmen Chu Announce Availability of Foreclosure Prevention Funds
July 22, 2009 – (RealEstateRama) — Mayor Gavin Newsom and Supervisor Carmen Chu announced today that the Mayor’s Office of Housing has received a special Mortgage Credit Certificate (MCC) allocation of $9.8 million dollars to prevent families from losing their homes to foreclosure under the 2008 Housing Assistance Tax Act. This funding provides homeowners with a vehicle to refinance sub-prime loans into traditional 30 year loans that they can afford. In addition, the funding can be used by first time homebuyers to purchase bank owned and short sale properties.
“In these challenging economic times, we cannot afford to have a single family lose their home when they do not have to,” said Mayor Newsom. “These funds will strengthen our housing market, care for our most vulnerable populations, and keep families where they belong – in their homes.”
To be eligible, homeowners must demonstrate: a) financial hardship and b) that they can afford a new traditional 30 year loan for their home. The funds are only available for mortgages under $625,000. The properties must be owner-occupied single-family houses, condominiums or townhouses within the City and County of San Francisco. Tenancies in common are not eligible.
“This program is a great example of how the City is thinking creatively about how to leverage funding to help our families on the brink of losing their homes to foreclosure,” said Supervisor Carmen Chu. “We hope this program will not only help stabilize families burdened with adjustable-rate loans, but also help stabilize the housing market.”
How does a Mortgage Credit Certificate (MCC) work?
The MCC Program is an IRS tax credit that is traditionally only available for first-time homebuyers. With an MCC, the qualified homeowner becomes eligible to take a federal income tax credit of 15% of the annual interest paid on the mortgage each year for as long as the homeowner lives in the same home. This credit reduces the federal income taxes of the homeowner, resulting in an increase in the buyer’s net earnings and the buyer’s capacity to qualify for a larger mortgage loan.
For more information, visit www.sfgov.org/moh or call the Mayor’s Office of Housing at (415) 701-5500.
