First-Time Homebuyer Affordability Act

What it does

• •Amends the Internal Revenue Code to exempt qualified mortgage bonds from the volume cap limitations that normally apply to tax-exempt bonds.
• •Removes the numerical ceiling on the amount of qualified mortgage bonds states and local jurisdictions can issue for first-time homebuyer financing programs.
• •Makes the exemption effective for mortgage bonds issued after the date the Act is enacted.

Why it matters

• •The volume cap has historically limited the amount of tax-exempt mortgage bonds available for first-time homebuyer programs; removing this cap expands the pool of funding available for such bonds.
• •Tax-exempt bond financing typically reduces borrowing costs for eligible homebuyers, making mortgages more affordable.

Who is affected

• •First-time homebuyers eligible to receive financing through qualified mortgage bond programs.
• •State and local housing finance agencies that issue mortgage bonds to fund first-time homebuyer programs.

What happens next

The bill has been referred to the House Committee on Ways and Means for consideration.