Mortgage Subsidy Bond


DEFINITION of 'Mortgage Subsidy Bond'

One of the few types of municipal bonds ever issued that may be subject to taxation, provided that the funds raised were used for home mortgages. Mortgage subsidy bonds were issued by cities and other municipalities, and may be either taxable or tax-free.

BREAKING DOWN 'Mortgage Subsidy Bond'

Mortgage subsidy bonds were created by the Mortgage Subsidy Act of 1980. They are issued by either state or local governments and are usually taxable. The exceptions are a select group of mortgage bonds and veterans' bonds.

  1. Bond

    A debt investment in which an investor loans money to an entity ...
  2. Rural Housing Service - RHS

    An administrative division within the U.S. Department of Agriculture ...
  3. Mortgage Bond

    A bond secured by a mortgage on one or more assets. These bonds ...
  4. Municipal Bond

    A debt security issued by a state, municipality or county to ...
  5. Subsidy

    A benefit given by the government to groups or individuals usually ...
  6. U.S. Savings Bonds

    A U.S. government savings bond that offers a fixed rate of interest ...
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