Hogan Administration Announces First State Housing Finance Bond Rating Upgrade in 40 Years
ANNAPOLIS, MD (February 19, 2020) – The Maryland Department of Housing and Community Development today announced that Moody’s Investors Service, a major credit rating agency, has upgraded the Maryland Community Development Administration’s Residential Revenue Bond Program. The upgrade took place in connection with the $130.75 million 2020 Series A (Non-AMT) and $9.25 million 2020 Series B (AMT) bond issuance.
“This upgrade demonstrates our commitment to solid fiscal management amid an unprecedented growth in our affordable homeownership program,” Governor Larry Hogan said. “Thanks to the hard work of our team at the Department of Housing and Community Development, we have one of the most effectively managed bond programs in the nation.”
The upgrade by Moody’s Investor Service to an Aa1 rating with Stable Outlook from an Aa2 rating is based upon the robust pace of first-time homebuyer loan originations over the last several years, and the expectation that increased bond issuance in 2020 will be used to purchase mortgage-backed securities, thereby reducing the portfolio’s overall exposure to whole loans and reducing risk within the program.
The rating upgrade comes shortly after the Maryland Department of Housing and Community Development’s recent announcement that the Maryland Mortgage Program has reached $1 billion in reservations in 2019, representing more than 4,000 homebuyers. The Maryland Mortgage Program provides fixed-rate mortgages that are available with downpayment and closing cost assistance, tax incentives, and the nationally-recognized innovative student debt relief homeownership initiative, Maryland SmartBuy.
“Bond issuances generate critical funding for many of the department’s programs, particularly homeownership programs,” said Secretary Kenneth C. Holt. “This historic ratings upgrade will make these bond issuances more attractive to investors and potentially expand our resources to provide safe, sustainable mortgages to prospective Maryland homebuyers.”