The Colorado Housing and Finance Authority, or CHFA, has rolled out a new program that hopes to supercharge homeowner's federal tax savings.
The program offers a Mortgage Credit Certificate which works by giving money back to first time homebuyers and homeowners who qualify, in the form of a tax credit. When borrowers prepare their income taxes every year they can take 20 percent of interest that they pay on that mortgage and write it off as a dollar for dollar tax credit.
A simple example would be if a family or individual pays $10,000 a year in interest on their mortgage, then $2,000 of that 10,000 or 20% would come back to them as a tax credit. The homeowner would receive the credit for as long as they own the home, whether that's 3 years or 30 years...
To qualify you must be a first time homebuyer, whom the IRS defines as someone who hasn't owned a home in the last three years, or be a homeowner that has an adjustable rate mortgage, and would like to refinance into a long term fixed rate mortgage, that provides the mortgage credit certificate. You must also have a credit score of at least 580 and meet income and purchase price limits which vary by area.
The money first time homeowners get back through this program is on top of the $8,000 credit they currently get from the federal government for buying a home.
For more information and to qualify, click the link below this story.