Definition of extraordinary call

early redemption of a revenue bond by the issuer due to elimination of the source of revenue to pay the stipulated interest. For example, a mortgage revenue municipal bond may be subject to an extraordinary call if the issuer is unable to originate mortgages to homeowners because mortgage rates have dropped sharply, making the issuer's normally below-market mortgage interest rate suddenly higher than market rates. In this case, the bond issuer is required to return the money raised from the bond issue to bondholders because the issuer will not be able to realize the expected interest payments from mortgages. Extraordinary calls may also be necessary if another revenue-producing project such as a road or bridge is not able to be built for some reason. Calls are usually made at PAR. Also called a special call.