Can Bonds be prepaid?
Bonds issued through the NHMBB cannot be prepaid. The NHMBB combines all of the borrowers together to issue bonds in the market. Each maturity consists of several governmental entities. The NHMBB bonds can be called at certain dates by maturity when the market is conducive to a refunding. In the past, when the rates dropped, the NHMBB called maturities and shared the savings with the borrowers participating in the maturities that were called. If the district issues its own bonds or borrows from a bank, terms can be determined for prepayment. In general, the rates will be higher, if prepayment is allowed.
