Glossary of Municipal Securities Terms

HOUSING REVENUE BOND

bond issued to finance multi-family housing projects or single-family home mortgages secured by the payment of the underlying mortgage loans.

Single family mortgage revenue bonds – Bonds issued to finance mortgage loans on single-family homes, either directly by purchasing newly originated or existing mortgage loans or indirectly by allowing lenders to purchase mortgage loans using bond proceeds. Such mortgage loans generally are targeted to first-time homeowners meeting certain income and purchase price requirements. Repayment of the mortgages may be further secured by federal programs or through private mortgage insurance. See: PRIVATE ACTIVITY BOND – Qualified mortgage bonds.

Multi-family housing revenue bonds – Bonds issued to finance construction or rehabilitation of multi-family housing projects where a specified proportion of the units will be rented to moderate- and low-income families, in some cases specifically targeted toward elderly residents. These securities may provide financing either directly or through a loans-to-lenders program, and may be secured, in whole or in part, by federal agency guarantees or subsidies. See: LOANS-TO-LENDERS PROGRAM; PRIVATE ACTIVITY BOND – Exempt facility bonds.

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