We are writing to you today to provide an update on the state of CHFA in terms of the current market. As you are no doubt aware, the financial market situation has affected the entire lending and credit market. The municipal bond market is currently frozen and few bonds are being issued. Although we have staff continuously monitoring the situation, it remains unclear how long it will last. However, we feel it is important to respond proactively. The financial market woes have greatly increased our cost of capital, and in some cases effectively terminated our capital sources.

As a result, we have raised rates for both the single family and multifamily production areas by more than 50 basis points. These increases are necessary is to offset what we project the future costs of capital and plans of finance will require. In the multifamily area, this change will not affect those loans for which a commitment letter has been executed. It will, however, affect loans in the pipeline. We will work with those borrowers to identify what alternatives may be available to them.

CHFA has always been responsible and prudent in our operations and we will continue to be so. We will share updates as we have them.

Please contact Jaime Gomez at 303.297.7440 or Cris White at 303.297.7373 with any questions you might have.