July 10, 2008
Clark among first to join state’s new employer-assisted mortgage program
Clark University is among five Worcester employers teaming up with the Commonwealth of Massachusetts to offer an employer-assisted mortgage program designed to help first-time homebuyers afford homes near to where they work. The "MassWorks" plan was announced July 9.
Besides Clark, Worcester Polytechnic Institute, Holy Cross, UMass Memorial Health Care, and Assumption College are the first organizations to offer MassWorks, a new statewide program that features the blending of an employer contribution and a dollar-for-dollar state match with traditional fixed-rate mortgage financing from a bank.
"We are pleased to be teaming up with these employers to help them promote homeownership for their employees and their neighborhoods," said Tina Brooks, the Patrick Administration’s housing chief. "MassWorks is another example of the Patrick Administration’s comprehensive efforts to assist homeowners and stabilize neighborhoods across the Commonwealth and we hope that more employers will take advantage of this wonderful benefit."
Created by the Massachusetts Housing Partnership (MHP) and the state Department of Housing and Community Development, MassWorks was unveiled today at a press conference announcing Buy Worcester Now, a multi-faceted effort by the city, state, local businesses and banks to offer a series of mortgage products designed to promote long-term homeownership. "We are pleased to be able to offer MassWorks as part of our comprehensive effort to promote homeownership in the city," said Michael V. O’Brien, Worcester’s city manager.
MassWorks is different than many traditional employer-assisted mortgage programs where employer funds are used strictly for down-payment assistance. While down-payment assistance is possible, MassWorks takes an employer contribution and a dollar-for-dollar state match and applies it to a homebuyer’s monthly mortgage payment, spread out over 10 years. This keeps a homebuyer’s payments low.
"Clark has long recognized the importance of homeownership for creating strong neighborhoods and building community," said John Bassett, president of Clark University. "The addition of MassWorks to Clark’s existing employee homeownership package will make living in the neighborhood around Clark more affordable for many of our employees."
MassWorks’ graduated payment system is modeled after MHP’s SoftSecond Loan Program, which has helped nearly 12,000 households purchase their first home, while maintaining industry-low foreclosure rates. SoftSecond has been especially successful in Worcester, making almost 500 loans. MHP is a state, non-profit affordable housing agency funded by banks.
MassWorks can be flexible to an employer’s specific goals. The minimum employer contribution per employee is $2,500 and the state will match every dollar an employer puts in up to $5,000. MassWorks will be offered through participating banks and will be administered by MHP.
According to City of Worcester Housing Director Scott Hayman, MassWorks and the www.buyworcesternow.com initiative have sparked significant interest among major Worcester area employers as well as local banks and credit unions who are interested in offering the SoftSecond Loan Program. "We are very encouraged by this and poised to bring more employers and lenders on board," said Hayman.