Document Type

Research Report

Publication Date



The SoftSecond Loan Program emerged at the end of a tumultuous year of struggle over community reinvestment issues that began on January 11, 1989. The lead story in that day’s Boston Globe reported that a draft study by researchers at the Federal Reserve Bank of Boston had found that there was a pattern of “racial bias” in Boston’s mortgage lending, that the number of mortgage loans in the predominantly black neighborhoods of Roxbury and Mattapan would have been more than twice as great “if race was not a factor,” and that “this racial bias is both statistically and economically significant.”

In the aftermath of the Boston Globe’s story, the Massachusetts Affordable Housing Alliance (MAHA) joined with other community-based groups to form the Community Investment Coalition. While supporting the broad range of demands made by the coalition, MAHA’s particular focus was on the need for affordable mortgages. As the year progressed, banks announced a series of plans to open more branches and ATMs, finance the construction of affordable rental housing, and increase lending to minority-owned businesses. By year-end, affordable mortgage lending was the only issue on which community groups and banks had not crafted an agreement. MAHA’s members wouldn’t drop the issue and continued to insist on a mortgage program with below-market interest rates; the banks continued to insist that such a program would not be sustainable. Finally, a full year after the Globe’s story, Mayor Ray Flynn facilitated an end to the impasse – an agreement to make $30 million of below-market mortgage loans to low- and moderate-income Boston homebuyers.

By the end of 2003, the SoftSecond Loan Program (SSLP) had enabled almost seven thousand lower-income households to purchase homes in 179 cities and towns throughout Massachusetts. Thirtyeight banks currently participate in the program. This report presents detailed information on the growth and current operation of the SSLP, with particular focus on the most recent three-year period.


A report prepared for the Massachusetts Community & Banking Council (MCBC).

The report is updated in another report prepared for MCBC by the present author in 2007: Expanding Homeownership Opportunity II: The SoftSecond Loan Program, 1991-2006.



To view the content in your browser, please download Adobe Reader or, alternately,
you may Download the file to your hard drive.

NOTE: The latest versions of Adobe Reader do not support viewing PDF files within Firefox on Mac OS and if you are using a modern (Intel) Mac, there is no official plugin for viewing PDF files within the browser window.