Affordable Housing Bond Enhancement Act
Sponsored By: Representative Yakym, Rudy [R-IN-2]
Introduced
Summary
Would expand federal support for affordable housing by loosening limits on mortgage revenue bonds and modernizing mortgage credit certificates. It would add new annual reporting for state bond activity and give states more flexibility to move unused bond authority so more housing can be financed.
Show full summary
- State and local housing agencies would face a new annual December 31 report requiring state ceilings, carryforwards, total bond authority, amounts issued, expired carryforwards, and excess amounts. The bill would require electronic reporting and allow disclosure to certain congressional committees.
- Homeowners and borrowers would see key changes: refinancing loans could qualify as refinancing for mortgage revenue bond rules, and the maximum qualified home improvement loan would rise from $15,000 to $75,000 with inflation adjustments after 2026.
- Issuers, borrowers, and owners of bond-financed homes would get more flexibility and simpler rules. The bill would let states transfer and redesignate carryforwards within the state, shorten the tax recapture schedule to a 5-year tier (20%, 40%, 60%, 80%, 100%), extend and change mortgage credit certificate rules, cut public notice from 90 to 30 days, and remove a lender reporting requirement.
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Bill Overview
Analyzed Economic Effects
6 provisions identified: 4 benefits, 0 costs, 2 mixed.
Bigger home improvement loan limit
If enacted, the maximum qualifying home improvement loan would increase from $15,000 to $75,000. For calendar years beginning after 2026, the $75,000 limit would be increased for inflation each year and rounded to the nearest $100. This change would apply to loans made after the last day of the calendar year that includes enactment.
Flexible mortgage tax credits for homeowners
If enacted, mortgage credit certificates (MCCs) would use a new credit base equal to the certified indebtedness on which you paid or accrued interest. The issuing authority would set an annual certificate rate between 1% and 5% and could change that rate each year. MCC rules would apply to MCCs issued on or after the first day of the second calendar year after enactment. The bill would also shift some reporting from lenders to issuing authorities, require electronic statements for calendar years after enactment, shorten certain public notices to 30 days for notices after December 31, 2025, and allow limited revocation of nonissued bond amounts if made by the end of the next calendar year.
Shorter tax recapture for homeowners
If enacted, the recapture holding period for certain mortgage bond benefits would be shortened to five years for taxable years beginning after December 31, 2025. Disposition in year 1 after the testing date would use 20%, year 2 40%, year 3 60%, year 4 80%, and year 5 100% holding percentages. If federally subsidized debt is fully repaid during any year of the four-year period starting on the testing date, later holding percentages would be zero.
Easier refinancing for bond borrowers
If enacted, homeowners who meet the principal residence and income tests at refinancing would be able to refinance without that refinancing counting as an acquisition for mortgage revenue bond limits. For those refinancings, certain acquisition rules would not apply and calculations would use the home's market value at the time of refinancing. These rules would apply to refinancing loans made on or after enactment.
States can transfer housing bond authority
If enacted, issuing authorities could use a private activity bond carryforward to issue housing bonds up to that carryforward amount for the next three calendar years. Authorities could transfer carryforwards within the same State to other issuing authorities authorized to issue qualified mortgage bonds or specified exempt facility bonds. Receiving authorities could redesignate transferred carryforwards for mortgage bonds, mortgage credit certificates, or certain exempt facility bonds. State law could limit transfers, except for constitutional home rule cities. These rules would apply to elections made after December 31, 2025.
Annual federal report on state bond use
If enacted, the Treasury Secretary would send Congress an annual electronic report by December 31 for calendar years beginning after enactment. The report would list each State's prior-year ceiling, carryforwards available at year start, total bond authority, private activity bonds issued by purpose (including carryforward use), carryforwards that expired, and excess amounts not treated as carryforwards. The Secretary could disclose this information to specified congressional committees.
Sponsors & CoSponsors
Sponsor
Yakym, Rudy [R-IN-2]
IN • R
Cosponsors
Rep. Moore, Gwen [D-WI-4]
WI • D
Sponsored 2/9/2026
Rep. Vindman, Eugene Simon [D-VA-7]
VA • D
Sponsored 5/7/2026
Roll Call Votes
No roll call votes available for this bill.
View on Congress.gov