Unprecedented demand for affordable home mortgage loans pushes overall lending to more than $753 million
BOSTON, MA – August 7, 2009 – (RealEstateRama) — Governor Deval Patrick announced today that MassHousing had its best lending year in state history in fiscal year 2009, providing more than three-quarters of a billion dollars for affordable housing.The landmark year was due to a surge in lending to first-time homebuyers. They have flocked to MassHousing’s 30-year fixed rate-mortgages with low downpayment requirements – a feature that has virtually disappeared from the private lending market in the wake of the mortgage lending crisis.
“Providing quality affordable housing for working people is a critical part of our plan to strengthen our economy and our communities,’’ said Governor Patrick. “MassHousing is helping thousands of low and moderate-income homebuyers get a toehold in the middle class.’’
“The MassHousing loan has proven to be a tremendous incentive for first-time homebuyers,” said Lieutenant Governor Tim Murray. “The surge in lending shows that this tool is truly assisting families with the means to afford their first home.”
Agency-wide, MassHousing made a total of $753.2 million in loans last fiscal year, an increase of 7.3% over last year’s total of $702 million and nearly 5% more than the previous Agency record of $720.5 million set in fiscal year 2007.
Approximately $506 million of last year’s loans went to more than 2,600 Massachusetts borrowers to buy or refinance a home. Lending to homebuyers was up 8.5% over the last fiscal year, and up 92% from just 3 years ago.
MassHousing Executive Director Thomas R. Gleason attributed the Agency’s strong performance over the last several years to a two critical factors.
“Certainly one of the reasons we did so well in home ownership lending is that we are one of the only lenders still offering low- and no-downpayment options,” Gleason said. “We’ve also had consistent access to capital, so we have money to lend, and with those two factors combined, we’ve managed to double our market share in the last 18 months alone.”
MassHousing’s mortgage insurance fund also had a record year. The fund — which private lenders often tap into to insure some of their affordable “portfolio loans” — guaranteed nearly $140 million in non-MassHousing loans, an increase of 183% from last year’s total of $49.2 million Those loans, financed with the banks’ own capital, are affordable to buyers with modest incomes, but would not have been made without the MassHousing insurance.
In addition to affordable home mortgage loans, MassHousing also finances apartment buildings where at least 20% of the units are affordable to lower income renters. MassHousing’s fiscal year 2009 lending for rental housing accounted for approximately $107 million, which was a significant achievement given the difficult rental housing market conditions.
About MassHousing
MassHousing (The Massachusetts Housing Finance Agency) is an independent, quasi-public agency created in 1966 and charged with providing financing for affordable housing in Massachusetts. The Agency raises capital by selling bonds and lends the proceeds to low- and moderate-income homebuyers and homeowners, and to developers who build or preserve affordable and/or mixed-income rental housing. MassHousing does not use taxpayer dollars to sustain its operations, although it administers some publicly funded programs on behalf of the Commonwealth. Since its inception, MassHousing has provided more than $5.6 billion for rental housing and more than $4.8 billion for homeownership. For more information, visit the MassHousing website at www.masshousing.com.
