FAQ

Step 1 - Learn about the bonds

Read the Preliminary Official Statement (POS) available from this website or from the participating brokers to learn more about the bonds, including their security, maturity dates, credit ratings, the types of projects they finance and other information that you may find important to help you make an informed investment decision. This website is not an offer to sell any bonds.

Step 2 - Open a brokerage account

You must have an account with one of the brokerage firms participating in the bond sale, or with another firm that can place an order through a brokerage firm participating in the bond sale. Please check to determine if your broker can place an order through the participating brokers. (If you have a brokerage account, go to Step 3.) If you do not have an account, you may open one and purchase bonds during the Retail Sale Order Period. A list of brokers participating in the sale can be found on the left side of this page.

Investors are encouraged to begin the New Account process well in advance of the sale date. Depending on the brokerage firm, internal new account procedures may take some time to process.

Step 3 - Place your order

Contact the broker with whom you have an account, either online or by phone, to get more information about how to buy bonds during the Retail Sales period. Discuss with the broker the number of bonds, the maturity date and the price at which you are willing to purchase the bonds, as well as any questions you may have from examining the Preliminary Official Statement (POS).

View ratings for our bond programs from rating agencies such as Moody’s Investors Service, S&P Global Ratings, and Fitch Ratings

Maryland general obligation bonds are issued in denominations of $5,000 each and can be purchased in any integral multiple thereof. This is the par value of the bonds. However, depending on various market related factors, your purchase price could be at a premium or discount to the par value, meaning the purchase price could be somewhat above or somewhat below the actual par value.

Both the coupon rate and the yield of a bond are important when considering how much interest a bond pays. Many of Maryland’s general obligation bonds are structured with a 5% annual coupon rate, though the coupon rate can vary and be higher or lower than 5%. Maryland’s general obligation bonds also are usually structured so interest is paid semiannually and the coupon rate does not change and is known from the time the bonds are sold. However, the yield, or what is often thought of as the income rate of return, of a specific Maryland bond will vary depending on many different market related factors, including whether the bond is purchased at a premium, discount or par.

Maryland general obligation bond issuances are normally structured with anywhere from two to 15 year maturities, so that a portion of the overall bond sale matures annually. By law, Maryland’s general obligation bonds must mature within 15 years. This means that on the secondary market maturities of Maryland general obligation bonds could vary anytime from very near term to 15 years from the most recent sale.

In addition to Maryland general obligation bonds, State agencies also issue bonds. For instance, there are Consolidated Transportation Bonds and Bay Restoration Bonds. Proceeds from the Community Development Administration Bonds are used to make mortgage loans, primarily to first time home buyers. The Maryland Health and Higher Education Facilities Financing Authority uses bond proceeds to build hospitals and educational institutions. The University System issues bonds to finance higher education facilities. Finally, many local governments in Maryland also issue bonds. You should check with your broker about the rating of these bonds and about any special call provisions.