Finance
Vermont first-time homebuyers who use VHFA financing may also qualify for which additional benefit?
AProperty tax exemption for 10 years
BMortgage credit certificates (MCC) providing a federal tax credit on a portion of the mortgage interest paid✓ Correct
CAutomatic Act 250 exemption
DFree home inspection
Explanation
Vermont's VHFA and related programs may offer Mortgage Credit Certificates (MCCs), which give qualifying first-time homebuyers a federal income tax credit (not just deduction) equal to a percentage of annual mortgage interest paid, reducing their federal tax liability.
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Key Terms to Know
Discount Points
Prepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
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