WASHINGTON -- New rules proposed for HUD's low-income housing preservation program may hinder 501(c)(3) bond deals being planned to finance purchases of multifamily units under the program, market participants said last week.

A draft of a Department of Housing and Urban Development notice obtained by The Bond Buyer states that deals under HUD's program financed with tax-exempt bonds would be subject to the same stringent rules already in force for non-bond deals, which are financed instead through federally insured loans under Section 241 of the housing code.

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