The Nevada Housing Division can not make a specific recommendation regarding who a developer may chose for credit enhancement for their business deal. However, it is an underwriting policy standard of the Nevada Housing Division that all credit enhancers have a minimum long term rating of Aa/AA. Thus, any banking organization (Letters of Credit), Government Sponsored Enterprise (Mortgage Backed Securities) or bond insurer whose long term rating meets the Aa/AA standard is theoretically eligible to provide credit enhancement on a multiunit private activity bond issue.

Secondly, all credit enhancements must run to the length of the bonds. That is, the maturity of the bonds and the maturity of the credit enhancement must be the same. If a credit enhancer does not issue Letters of Credit etc for a typical twenty-five to thirty years of a mortgage on a project, then a enhancement of lesser term may be acceptable so long as it renews or is substituted with Housing Division approval, by an equally high or higher rated credit enhancement. Absent approved substitution or renewal, the credit enhancement must allow for full call of the bonds upon expiration of the enhancement. Specific inquiries should be addressed to the Housing Division's Chief Financial Officer at 775-687-4258 ext 223 or e-mail: nhd@nvhousing.state.nv.us

The following list does not constitute an endorsement and is not considered an exhaustive listing of all possible institutions or organizations who may provide credit enhancement on a real estate secured business transaction. Rather it is provided as a helpful list to potential applicants who may not have a strong working knowledge of the credit enhancement financial markets.

GOVERNMENT SPONSORED ENTERPRISES

• Federal National Mortgage Association (FNMA) via a DUS lender [either the forward commitment or collateral pledge arrangement]

• Federal Home Loan Mortgage Corporation (Freddie Mac) via an approved lender

• Federal Home Loan Bank via sponsoring participant