Dick Larkin's Palm Beach Post Weekly Column: TAX-EXEMPT HOUSING AUTHORITY BONDS

Dick Larkin
Director of Credit Analysis
Stoever Glass & Co., Inc.
P: (862) 432-8818
E: dlarkin@stoeverglass.com

This sector has several spectrums of risk:

1. Statewide portfolios of single family mortgage backed bonds, governed by state credit-lending requirements, have low default risk;
2. Statewide portfolios of multi-family mortgage apartment rental or condominium housing projects have low-to-moderate default risk; and
3. Local, site-specific projects of single family homes or apartments that are very narrow in scope or geographic diversity, have one of the highest yields, but also one of the highest default risks in the municipal market.

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10/31/2016 | In general, bond ratings are higher for state-wide single family mortgage programs, with ratings as high as “AAA” to “AA”, because of loan diversity, and the intrinsic safety of single-family mortgage pledges.
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