A bill to amend the Internal Revenue Code of 1954 to clarify certain requirements which apply to mortgage subsidy bonds.

Amends the Internal Revenue Code to revise requirements for the tax exclusion of interest on mortgage subsidy bonds. Revises the arbitrage requirements for tax-exempt bonds to increase the amount by which interest rates on such bonds may exceed the interest rates on mortgages financed with such bonds.

Increases the amount by which the acquisition cost of bond-financed residences may exceed the average area purchase price of other homes in the same statistical area.

Specifies that issuers are not required to dispose of any investment and realize a loss in order to satisfy arbitrage restrictions.

Revises the new homeowner requirements to allow eligibility for bond-financed mortgages for persons who are residing in substandard housing or who have lost their homes because of natural disasters or governmental action.

Repeals the registration requirements for bond issues.

Revises requirements for residential rental property bond issues relating to the median income level of occupants and the term of the low-income occupancy.

Allows the exclusion of interest on industrial development bonds used to finance cooperative housing corporations if the cooperative is affordable by lower income families and other conditions are met.