Lee Hansen: MCC the Key to Homeownership

Getting a home mortgage can be complicated. There are credit reports, appraisals, downpayment requirements, title insurance, points and other details. Adding a Mortgage Credit Certificate (MCC) would seem like a daunting addition, but for Lee Hansen, the process was rather simple. Hansen was among the first South Dakota homebuyers to take advantage of the MCC when he purchased his home in Centerville in March 2013. "It was a little complicated, but not too bad," Hansen said. "My dad told me about it." His father, Bill Hansen, is a member of the SDHDA Board of Commissioners, which approved the MCC program's launch in 2013.

The MCC is an enhancement to the First-time Homebuyer program which allows borrowers to recoup 20 to 40 percent of their mortgage interest as a tax credit. It is not a tax deduction, but a dollar-for-dollar tax credit that puts money back in your pocket, up to $2,000 per year for as long you are making mortgage payments.

Donna Larson, loan officer with Dacotah Bank in Sioux Falls, handled Hansen's mortgage. "It's not hard to explain the MCC to borrowers," Larson said. "The literature from SDHDA provided us a step-by-step way to calculate the benefits."

MCCs are a new product for South Dakota. "A number of customers have asked about it and I anticipate they will eventually take advantage of it," commented Larson.