Posted on May 6, 2011
BOSTON, May6, 2011 --- The SoftSecond Loan Program for first-time homebuyers has been selected as one of the top 25 programs in the U.S in Harvard University's Innovations in American Government Awards Competition.
Conducted by the Ash Center for Democratic Governance and Innovation at the John F. Kennedy School of Government, the competition recognizes local, state and federal programs for creative problem solving. SoftSecond was selected from a pool of over 500 qualified applicants. Five finalists and one winner of the Innovations in American Government Award will be announced in the fall. For more on the competition, go to the Ash Institute news release and descriptions of all Top 25 Innovations finalists.
"On behalf of the Patrick Administration and the banks, legislative leaders and community groups that have consistently supported this program, we are honored that the Ash Institute has recognized the SoftSecond Loan Program, not just for helping thousands of first-time homebuyers but also for doing so in a responsible and effective way," said Clark Ziegler, MHP's executive director.
SoftSecond: An innovative success story
A fixed-rate mortgage product for low and moderate-income first-time homebuyers, SoftSecond has helped over 15,000 families achieve successful homeownership while posting delinquency and foreclosure rates that are consistently at or below prime mortgages.
SoftSecond was created in 1990 to address concerns that minority and lower-income homebuyers in Boston did not have equal access to mortgage financing. MHP, community groups and banking leaders came together to address the problem and determined that one of the biggest obstacles to long-term successful homeownership was a mortgage structure that only considered payments in the first year without considering the borrower's ability to make payments over the life of the mortgage.
By combining fixed-rate financing from a bank with a small one-time state subsidy, SoftSecond monthly mortgage payments start lower and gradually increase over the first 10 years of the loan. Introduced as an innovative pilot program in Boston, it was eventually taken statewide. Today, the program is offered by over 40 banks and has leveraged over $2.4 billion in private mortgage financing. It is administered by MHP.
2nd time MHP innovation has been cited
This is the second time that an MHP innovation has been recognized by the Ash Institute. In 2008, MassDocs was a Top 15 finalist. MassDocs was recognized for making the development of multi-family affordable rental housing more efficient by creating a system in which one set of loan documents is used for developments using multiple funding sources.
The Ash Center for Democratic Governance holds the Innovations in Government Award Competition to recognize public programs that offer unique solutions in health and wellness, social services delivery, the environment, economic development, and education policy areas.
"This year's Top 25 Innovations in Government demonstrate smart solutions to a range of social issues-from expanding green spaces in urban areas, aiding low-income residents with achieving home ownership, and better preparing our next generation of teachers, to fostering economic growth by scaling up home grown industry," said Tony Saich, director of the Ash Center . "These Top 25 Innovations show that innovation is indeed flourishing at all levels of government."
The Innovations in American Government Awards was created by the Ford Foundation in 1985 in response to widespread pessimism and distrust in government's effectiveness. Since its inception, over 400 government innovations across all jurisdiction levels have been recognized and have collectively received more than $20 million in grants to support dissemination efforts. Such models of good governance also inform research and academic study around key policy areas both at Harvard's Kennedy School and academic institutions worldwide. Past Innovations winners have served as the basis of case studies taught in more than 450 Harvard courses and over 2,250 courses worldwide.
About the Ash Center for Democratic Governance and Innovation: The Roy and Lila Ash Center for Democratic Governance and Innovation advances excellence and innovation in governance and public policy through research, education, and public discussion. Three major programs support our mission: the Program on Democratic Governance; the Innovations in Government Program; and the Rajawali Foundation Institute for Asia. For more information, visit www.ash.harvard.edu.