Issuers can offer a lending program to borrowers who do not qualify for a mortgage from a tax-exempt bond program by structuring the second mortgage bond issue as a taxable borrowing. By combining the second mortgage with a first mortgage obtained in the traditional mortgage market, issuers can offer a down payment assistance program at levels that the traditional mortgage market cannot match—even through seller assisted programs offered by 501(C)(3)'s.

 

 
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