Rocky Hill, Conn., – August 18, 2014 – (RealEstateRama) — The Connecticut Housing Finance Authority (CHFA) completed a successful offering of $123 million in Tax Exempt Bonds on Monday, August 4, 2014. The offering was oversubscribed, generating more than $400 million in orders in one day. A significant percentage of the orders or $104 million came from retail and institutional investors in Connecticut, who are familiar with CHFA’s financial strength and track record. Proceeds from the sale of these bonds will be used to finance the Authority’s single family mortgage program.
“We expect the proceeds from this bond sale to finance nearly 700 mortgages for first-time homebuyers in Connecticut,” said Eric Chatman, CHFA’s president and executive director. “CHFA’s mortgage programs are designed to help low- to moderate-income homebuyers purchase their first home. Bringing first-time buyers into the housing market is essential to keeping the housing recovery going,” he added.
The current below market interest rates on CHFA mortgages for first-time homebuyers ranges from 3.25 percent to 3.6 percent. In the first six months of 2014, CHFA financed $152 million in mortgages. Since its founding in 1969, CHFA has financed more than 130,000 mortgages for first-time homebuyers.
As a quasi-public self-funded agency, CHFA’s bond program is an important tool for financing affordable housing in the state. In addition to single family mortgages, bond proceeds are used to finance affordable multifamily rental housing developments, which in turn generate jobs and tax revenue and economic activity in the state. The fact that many orders for the bonds came from local investors reflects the confidence the private sector places on CHFA and its affordable housing mission.
CHFA maintains a AAA rating with Standard & Poor’s and a Aaa rating with Moody’s Investor Services, which allows the Authority to achieve the lowest cost of funds. The 2024 bonds for example, were sold at a spread of 68 basis points over the Municipal Market Data (MMD) benchmark or 2.95%. The August 4 Tax Exempt Bond offering was CHFA’s third bond issue in 2014. The previous issuances were used to fund single family mortgages and the development of affordable multifamily rental housing. JP Morgan was the Lead Senior Manager on the offering.
The Connecticut Housing Finance Authority (CHFA) was created in 1969 by the Connecticut Legislature as a self-supporting quasi-public housing agency charged with expanding affordable housing opportunities for the state’s low- and moderate-income families and individuals. CHFA has helped more than 130,000 Connecticut individuals and families become homeowners through its low-interest single-family mortgage programs. In addition, CHFA has financed the creation of nearly 40,000 affordable, rental units throughout the state. To date, the combined mortgage financing for CHFA’s single-and multifamily housing programs exceeds $11 billion. For more information: http://www.chfa.org