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Learn About Homebuyer Tax Credit Program

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How does the Homebuyer Tax Credit work?

The Homebuyer Tax Credit is a direct dollar-for-dollar reduction in your federal taxes worth 10% to 50% of the interest you pay on your mortgage.

You can estimate your potential savings by using the following


"Mortgage amount x loan interest rate = annual mortgage interest paid. Annual mortgage interest paid x Homebuyer Tax Credit rate = annual tax credit."


$150,000 mortgage x 5% interest rate = $7,450 paid in annual interest

$7,450 x 35% Homebuyer Tax Credit rate = $2,607 ($2,000 maximum annual tax credit). Keep in mind the remaining annual interest paid, that is not taken as a tax credit, can still be itemized on your tax return.

Note: Your annual tax credit savings cannot exceed $2,000. You also must have a tax liability to use the credit.

How can I apply for the Homebuyer Tax Credit?

To apply for a Homebuyer Tax Credit, contact a Participating Lender. There may be a nonrefundable fee to apply for the Homebuyer Tax Credit. If your clients is combining the Homebuyer Tax Credit with a New Hampshire Housing mortgage product, the fee may be reduced. For more information about this discount and to see a list of Participating Lenders, visit