The Allegheny County Residential Finance Authority last week sold more than $12.8 million of single-family mortgage revenue bonds to help finance loans for first-time homebuyers.
Darnell Moses, the authority's manager, said 150 to 200 mortgages would be generated with the bond proceeds. The agency sold about $13 million of bonds last fall, Moses said, and tries to come to market annually.
"We are out of money and we were probably out of money about a month ago," Moses said. "It went really quickly. We work with about 15 different lenders. They get the word out and the money just really flew this year."
Mellon Financial Markets LLC was lead underwriter for the new bonds. PNC Capital Markets was co-manager. Eckert Seamans Cherin & Mellott LLC is bond counsel, and Cohen & Grigsby PC is underwriter's counsel. Caine Mitter & Associates Inc. and CFX Inc. are the financial advisers.
The bonds are subject to the alternative minimum tax. They were priced to yield 3.90% for the first maturity in 2008. Bonds due in 2035 offered a 5% coupon priced at par and bonds due in 2037 featured a 5.75% coupon and a yield of 4.23%.
Moody's Investors Service rated the bonds Aaa.
Moses said he thinks the authority's loan program became more attractive as commercial interest rates have begun to rise.
"For the last couple of years, we try to time it so we are doing a new issue so that almost one program is ending and a new program is beginning," Moses said. "This is the first time that there was a really big lag between money not being available and us being able to issue new debt."
The authority provides low interest loans to Allegheny County residents in 130 municipalities. Residents of Pittsburgh are ineligible.
Moses said the city residents could obtain loans through a similar program operated by the Pittsburgh Urban Redevelopment Authority.
Earlier this year, the redevelopment agency sold nearly $30 million of single-family mortgage revenue bonds that included $9 million of new money.
