BOISE - Moody’s Investors Service has assigned a "positive outlook" to the Idaho Housing and Finance Association’s subordinate bonds and a "stable outlook" to its senior and mezzanine bonds, the Association announced today.

Moody's assigned the following ratings to IHFA’s most recent bond issue, the Single Family Mortgage Bonds, 2000 Series E:

• AAA on $29.75 million Senior Bonds
• AA2 on $3.15 million Mezzanine Bonds
• A1 on $2.1 million Subordinate Bonds

The Senior and Mezzanine Bonds are special, limited obligations and are secured by the revenues of the mortgage loans. The Subordinate Bonds are general obligations of the Association. According to Moody’s, "These ratings reflect Moody’s belief that the program’s solid structure and sound portfolio composition will lead to strong financial performance."

The investment service also cited IHFA’s "ability to quickly originate its loans" and "continued financial and loan portfolio maintenance" as adding to its credit strength and security. "We view this as an indication of the Association’s strong bond program management capabilities," they added.

"We are pleased that Moody’s has acknowledged the strength of our management and our loan programs by assigning a positive outlook to our subordinate bonds," said John Sager, IHFA vice president–treasurer. "This underscores the financial strength of IHFA bonds and will help us continue to attract the necessary capital to make home ownership a reality for first-time Idaho home buyers."

In 1978, IHFA began selling housing bonds on the national market to make low-interest mortgage loans available to Idahoans. The money generated by bond sales has provided low-interest mortgage loans to more than 40,000 Idahoans, most of whom are first-time home buyers. During FY99 alone, IHFA helped 3,300 families and individuals into home ownership, totaling an investment of $257,603,042 in loan production—a record in the program’s 22-year history.

IHFA’s bond programs allow it to fill a niche helping home buyers purchase their first home. The whole bond process is managed by IHFA. The Association is responsible for overseeing bond sales, purchasing the mortgage loans, collecting the mortgage loan payments and repaying bond investors. About 25 percent of IHFA bond buyers are individuals.

Bonds sold by IHFA are highly sought after because of their above-average return income and strong credit quality. IHFA bonds are tax-exempt, meaning that the interest paid to investors is tax-free. Investors pay no federal income tax; interest is also exempt from state income tax for Idaho residents.