What's new with the FHA's Section 242?

FHA hospital mortgage insurance, also called the Section 242 program, acts as a credit enhancement that allows borrowers to issue bonds up to the equivalent of an "AAA" rating, with the benefits of lower interest rates. Although the program has operated in relative obscurity over its 40 years of existence, the FHA has undertaken a new marketing campaign to raise its profile. Federal backing may make the program an attractive option amid today's financial turmoil in the capital markets.