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Frequently Asked Question About Bonds
What are Mortgage Revenue Bonds?
Mortgage Revenue Bonds are tax-exempt negotiable instruments that provide funding for mortgages. The bonds are repayable from the mortgages, however the full faith and credit of the City or the AHFC are not pledged to repay them.
How do Mortgage Revenue Bonds work?
Mortgage Revenue Bonds provide funding, through participating lenders, for mortgages to first-time homebuyers at below market interest rates.
Why do we issue bonds?
Bonds are issued to promote reasonably priced housing and homeownership opportunities.
Multi-Family Tax-Exempt Bonds
How do multi-family tax-exempt bonds work?
With the exception of bonds used to finance projects for non-profits, the authority to issue multi-family bonds is received through a lottery process. The AHFC issues the bonds which are sold or privately placed; The cash is deposited with a Trustee to fund the multi-family development. The bonds are repayable only from the rents. The AHFC does not assume any liability for the bond issue.
Why do we issue multi-family bonds?
To increase the supply of affordable rental housing.
Who benefits from multi-family bonds?
- Developers benefit because they are able to secure financing for their projects at below-market interest rates, therefore creating lower monthly payments for renters.
- Austin Renters benefit by having more units available to rent at affordable prices.
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