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What You Need to Know About the New Mortgage Credit Certificate Tax Incentive

There’s a new mortgage tax credit available for homebuyers in South Carolina, but surprisingly, not many buyers have taken advantage of it. News of the new Mortgage Credit Certificate (MCC) incentive has been slow to spread, with only eight people in the tri-county area and just forty-three statewide obtaining an MCC as of this March. The low number of takers probably has something to do with the fact that it wasn’t available in South Carolina until late last year.

The Mortgage Credit Certificate tax incentive is not a deduction, but a credit that lowers the amount of federal tax owed by up to $2,000 per year. Technically, the credit is intended for first-time homebuyers, but there is an exception. Most SC counties have the same qualifications, but less targeted areas, including Charleston and Greenville, have different rules.

What are the restrictions and qualifications of the Mortgage Credit Certificate?

Berkeley and Dorchester Counties:

Income limit of $74,640 for single person or couple

Income limit of $87,080 for a family of three

Must not own another principal residence at time of purchase

Charleston County:

Income limit of $62,200 for a single person or couple

Income limit of $71,530 for a family of three

Must not have owned another principal residence during the past three years

*Current homeowners in either county, or those are refinancing, will not qualify.

What’s the catch?

You might have to give some money back to the government if:

You sell the house after less than nine years, AND

Your income has increased to the point where you wouldn’t qualify for an MCC anymore, AND

You make a profit selling the house.

You’d still come out ahead, however, because the amount you would have to pay back is either 6.25% of the original loan amount, or half of the capital gain on the house, whichever is lower.

How do you obtain an MCC?

Meet the above qualifications based on county.

Secure a 30-year mortgage loan with a participating lender.

Pay a processing fee of $500-$700

You won’t have a hard time finding a lender who can help you land this tax credit. The list of preferred lenders includes banks such as SC Federal Credit Union, Wells Fargo, and The Bank of South Carolina; mortgage lenders like Starkey Mortgage and Movement Mortgage; and homebuilders’ mortgage departments like Pulte Mortgage and Ryland Mortgage.

For more thorough details and explanation, please visit www.SCHousing.com.

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How-To Tuesday: Repair Your Credit

Do the words "credit score" make you anxious? If the mere mention of it makes you shudder, you're not alone. Many Americans struggle with credit. Whether that's the result of having fallen on hard times, errors on a bank's or credit company's fault, or irresponsible spending, there is always help. While a bad credit report can be a stigma that leaves incredible weight on your shoulders, take comfort in the fact that credit repair doesn't have to be a difficult thing. Read on for our stress-free advice on how to fix your credit.

Understanding what affects your credit is the first step to repairing it. Below is a great chart from MyFico, outlining the breakdown of a FICO credit score for the general population, though the stated percentages can change depending upon your circumstances. Each of these categories are taken into consideration when it comes to determining a credit score. Note that details like marital status, race, age, employment, place of residence, interests rates, child/family support, and rental agreements, among others, do not affect your credit score at all.

Check for errors and dispute. The first action in our credit fix-it kit is requesting a free copy of your credit report. By law, each credit reporting company is required to provide a free credit report every 12 months. These can be found at www.annualcreditreport.com. Check your report for errors. They're more common than you might think! If you find any inconsistencies, disputing them is not difficult.

Break the late payment habit. Once you know the information in your credit report is accurate, it's time to tackle the problem areas. If late payments have become a problem, one of the best remedies is to set up regular reminders. Mark payment dates on a calendar; use a notifcation appon your phone; or ask your bank if they have a program that sends text or email reminders. If you want to make it really easy, consider enrolling in automatic payments.

Pay down your accounts... This is one of the most daunting parts of credit repair, but when it's done, you'll be amazed at the sense of relief it brings. First, stop using your credit cards for the time being. We know, we know. They're so convenient! It's so easy to buy now and pay later. But accumulating more debt will make things harder in the long run. Go through your credit report and make a list of your accounts, then gather your most recent statements for each one. To begin reducing your debt, try to pay your accounts down to 10% of the amount owed. This will be a great kickstart to your debt reduction campaign.

...then pay them off! Set up a payment plan, aiming to pay off the accounts with the highest interest first. Keep making minimum payments on your lower-interest accounts, and then contribute as much as you can each month to the higher-interest ones. Once you start to see the amounts owed dwindle, the weight they put on your shoulders will start to dwindle.

See a credit counselor. If your credit problems stem from financial struggles, a consulting a credit counseling service can help you find solutions and learn how to manage your credit.

Re-establish your credit history. It might seem counterintuitive, but opening new accounts responsibly and paying them off on time will raise your credit score. Someone who has credit cards and manages them responsibly will inevitably obtain a better credit score than someone without any credit cards at all. A caveat: keep balances low.

Once you complete these steps, you will see your credit score begin to rise. It won't happen overnight, and it might take a lot of work as far as management goes, but it will happen eventually. Often times, repairing your credit is an excellent learning experience. Because who wants to go through that more than once? Be vigilant, be consistent, and check your credit report regularly for errors. In the end, you'll once again be able enjoy the benefits of good credit and the relief being debt-free brings.

Infographic // What's the Difference Between an HOA and a Regime?

Does Your Lender Go Above and Beyond?

A mortgage lender should be more than a person who collects your information, checks your credit, and signs some forms. The best mortgage lenders are the ones who take the time to get to know you and your needs and offer tailored services. After all, they're working right beside you to help you take a big step in life! With that in mind, we would like to introduce to you one of our favorite loan officers, Tricia McCarthy from Starkey Mortgage.

Tricia makes obtaining a home loan a positive, pleasant process. She is friendly, offers personal service, and is highly knowledgable. "To me, it's always been more than a job," she says. "The satisfaction and pride I feel each time one of my borrowers becomes a homeowner is indescribable. Each one is an emotional investment for me as every borrower is more than just a loan. They are friends, neighbors, and my community."

Every interaction we have had with Tricia and Starkey Mortgage has been rewarding, and we cannot recommend them enough. As a preferred lender of the Hometown Heroes program, Starkey Mortgage is a shining example of giving back to the community. In addition, for every deal we close together, Starkey Mortgage will make a donation to a charity of our choice. So help us out by telling us what your favorite charity is and why in the comments below!

For more information on Tricia McCarthy and Starkey Mortgage, visit their website.

How-Tuesday: DIY Backsplash

Tired of having to clean dried cake batter and spaghetti sauce off your painted kitchen wall? The cause could be one of two things. Either your toddler is having way too much fun with his food, or you haven't installed a backsplash. There's not much we can do about that overly enthusiastic eater, but we can help you with the backsplash problem. Whether you don't have one at all or you're simply tired of staring at boring tiles or laminate while you cook, replacing a backsplash is one of the easiest and most practical DIY projects out there. Whether styled with masonry, embossed metal sheets, or mosaic tiles, making a backsplash is fun and easy and gives you a chance to add personality to any kitchen.

Here’s how to get started on your own:

1. Plan your backsplash. Decide how much of the wall you’d like to cover. The quickest, simplest plan is to cover the wall directly behind the stovetop, since this is where most of the errant splashes will come from. Some people, however, prefer to cover the wall along the entire stretch of countertop. This is entirely up to you. Just make sure to measure the area you want to cover so you don't end up having to trek back to the store to buy more materials or return a bunch of unused tile.

2. Prepare the walls. Check to ensure that they can withstand the added weight if you choose to use heavy tile or stone. Make any needed repairs so you can be sure that nothing’s festering underneath that pretty new surface. Remove electrical outlet covers carefully, and clean the area you will be covering.

3. Place the adhesive. Use the recommended adhesive for whichever material you’ve chosen. Ask an employee at your local home improvement store for certainty. Don't rush this step! Follow instructions carefully so that you won’t find yourself having to remove and reapply the adhesive.

4. Lay the tile. Carefully place your tile or other material of choice on the wall in whatever pattern you wish to achieve. Use a laser level if you wish for your tile to be perfectly aligned. Or if you're not a stickler for clean lines, go for the laid-back asymmetrical look.

5. Begin the necessary grouting procedure if tile was your material of choice. Then clean the tiles off, replace the outlet covers, and you're all finished!

That was easy! This is a project that has the potential to change the look and style of your kitchen completely, yet it can be completed in a day! Now you can rest assured that all will be well the next time your pots and pans start slinging sauce, or your blender sends globs of strawberry smoothie hurtling toward the kitchen wall. Cleanup is easy, and so is upkeep. Enjoy your new backsplash!