New York, November 27, 2012 --

Moody's Rating

Issue: Single Family Mortgage Class I Refunding Bonds, Series 2012A (sf); Rating: Aa2; Sale Amount: $202,605,000; Expected Sale Date: 11/8/12; Rating Description: Mortgage: Single-Family: Whole Loans

Opinion

Moody's Investors Service has assigned a Aa2(sf) rating to Idaho Housing & Finance Association (the "Association"), Single Family Mortgage Class I Refunding Bonds, Series 2012A. Moody's has also affirmed all Class I bonds on parity with the Series 2012A and all outstanding Class II and Class III bonds issued under the General Indenture of Trust, dated as of November 1, 2006 (the "2006 Indenture"). The outlook on the rating is stable. The Series 2012 A bonds are expected to be privately placed.

Rating Rationale:

The Aa2(sf) rating on Class I and Aa3(sf) rating on Class II bonds reflect sound overcollateralization levels resulting from substantial subordination of Class III bonds (rated A1(sf)), as well as the program's ability to continue to cover Class I and Class II debt service under various stress cash flow projections. The ratings are also reflect active and experienced management that has been successful in implementing prudent measures to mitigate the impact of the mortgage crisis, gradual stabilization and improvement of loan portfolio performance as well as counterparty concentration.

Credit strengths:

-- Program asset-to-debt ratios ("PADR ") have remained steady, as have fund balances as a percentage of debt; excluding potential loan loss, PADR of about 120% and 114% on Class I and Class II, respectively, provide adequate cushion against future loan losses at the assigned rating levels.

-- Demonstrated ability to continue to cover Class I and Class II debt service and other costs under various cash flow stress scenarios.

-- Active and experienced management that has been successful in implementing prudent measures to mitigate the impact of the mortgage crisis.

Credit challenges:

-- Substantial exposure to private mortgage insurers (PMI) and Barclays Bank PLC (rated A2/P-1) as the lone swap provider.

-- Credit pressures arising from risks associated with high level of variable rate debt ("VRDBs") and related swaps continue to affect program financial performance, albeit current transaction is expected to alleviate some of the pressure.

Outlook:

The outlook is stable based on the level of overcollateralization and prudent management of the program. The future direction of loan losses on the single family portfolio will continue to be a key credit driver for Class I and Class II bonds.

What Would Make the Rating Go Up

-- A significant increase in program PADR together with successful management of mortgage loan delinquencies and foreclosures so as to contain or reduce losses.

-- Continued successful replacement of expiring liquidity facilities or conversions of bonds to modes not requiring external liquidity, and reduction of the size of variable rate debt and related swaps as to strengthen the Association's balance sheet.

What Would Make the Rating Go Down

-- A significant decline in PADR as a result of declining profitability or increase in loan losses.

-- Higher than anticipated losses on delinquent/foreclosed loans.

-- Downgrades of counterparties below the benchmark for the program ratings or other unforeseen counterparty events, or lack of successful transition from TCLP liquidity facilities.

-- A downgrade of the Association's issuer rating which would primarily affect the rating on the class III bonds may affect Class I and Class II bonds.

The principal methodology used in this rating was Moody's Rating Approach For Single Family, Whole-Loan Housing Programs published in May 1999. Please see the Credit Policy page on www.moodys.com for a copy of this methodology.

REGULATORY DISCLOSURES

The Global Scale Credit Ratings on this press release that are issued by one of Moody's affiliates outside the EU are endorsed by Moody's Investors Service Ltd., One Canada Square, Canary Wharf, London E 14 5FA, UK, in accordance with Art.4 paragraph 3 of the Regulation (EC) No 1060/2009 on Credit Rating Agencies. Further information on the EU endorsement status and on the Moody's office that has issued a particular Credit Rating is available on www.moodys.com.

For ratings issued on a program, series or category/class of debt, this announcement provides relevant regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides relevant regulatory disclosures in relation to the rating action on the support provider and in relation to each particular rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides relevant regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

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Omar OuzidaneAsst Vice President - Analyst Public Finance Group Moody'sInvestors Service, Inc.250 Greenwich StreetNew York, NY 10007 U.S.A. JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653Florence Zeman Associate Managing Director Public Finance Group JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653 Releasing Office: Moody's Investors Service, Inc.250 Greenwich StreetNew York, NY 10007 U.S.A. JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653(C) 2012 Moody's Investors Service, Inc. and/or its licensors and affiliates (collectively, "MOODY'S"). All rights reserved.

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