HFA, which was created in 1960, issues tax-exempt and taxable bonds to fund mortgage loans for the construction and rehabilitation of low- and moderate-income multifamily rental developments. HFA is one of the oldest and most prolific issuers of multifamily housing revenue bonds in the U.S., with bond issuances totaling more than $1 billion in 2009 alone.
HFA issues fixed and variable rate tax-exempt and taxable bonds to fund mortgage loans for individual rental developments. The bonds financing these mortgage loans are primarily issued on a floating rate basis and credit-enhanced by a third party credit facility, such as a bank or a government-sponsored enterprise. The ratings on these bonds are directly tied to the credit enhancement facility securing the bonds or the project mortgage.
Most of our borrowers are single-purpose entities established for the sole purpose of developing the rental development they are financing. Therefore, bondholders are paid using only those funds derived from the project their bonds support and/or the credit enhancement facility.
PoolTo assist smaller projects, in 2007 the HFA launched its Affordable Housing Revenue Bond Program, under which HFA finances multiple projects on a pooled basis under one resolution. Similar to the Single Project Financing Program, developers of projects under the Affordable Housing Revenue Bond Resolution are typically single-purpose entities. Bondholders are paid solely from the assets pledged under the resolution to secure the bonds, including project revenues, funds and accounts, credit enhancement and mortgage loans pledged by the Agency for this purpose. The mortgage loans on the financed projects are pledged to the resolution, as are any payments received under credit enhancement facilities. As of December 2009, bonds issued under this resolution are rated Aa2.
HFA is one of five bond issuers in the State authorized to issue bonds under the State's Personal Income Tax ("PIT") Revenue Bond Program. The Agency issues PIT bonds annually to reimburse New York State for appropriated expenditures for its housing programs.
PIT bonds are secured by (1) payments made by the State Comptroller to the transaction trustee on HFA's behalf pursuant to a financing agreement between the State and HFA and (2) other funds held by the trustee under the General Resolution. As of August 2009, these bonds are rated AAA by Standard and Poor's and AA- by Fitch Rating Services.
Last updated: 3/23/2010 1:25:42 PM