does anybody remember the late 70’s - early 80’s when the prime rate got up to 23.5%, VA Loans were available at 16.5% & conventional mortgage loans were not available at any rate?
the housing market was DEAD
then somebody came up with the idea of municipal bond financing to secure single family mortgage loans.
the first round of state or county issued mortgages came to market around 8.00%!! subsequent issues came to market with mortgage note rates around 10%. still a bargain to the 16.5% VA loan rate with an after tax yield that compared favorably to the 14.5% CD rates from local banks & S&L’s
the municipal bond backing the mortgage loans offered investors tax free income on the bonds.
these municipal bond mortgage loans dropped loan rates & monthly payments became affordable again
this financing tool did CPR on the home building industry & offered an affordable entry point to the American dream of home ownership.
I’m surprised someone like howard lutnick or scott bessent, both having investment banking careers, haven’t dusted off this old mortgage concept & stuck it under trump’s nose??