2021 Boston elections

Jon Santiago wants City Hall to back mortgages for some first-time homebuyers

"I'm committing to using the City of Boston to serve as a mortgage guarantor to increase the buying power of clients."

State Rep. Jon Santiago during a press conference last month in the South End. Pat Greenhouse / The Boston Globe

The City of Boston has a pretty good credit rating — AAA for seven straight years.

Now, Boston mayoral candidate and state Rep. Jon Santiago wants to leverage that credit — and the city’s resources — to help residents buy their first home.

As part of a sweeping housing plan released Thursday, the South End Democrat pledged to create an apparently first-in-the-nation program in which City Hall would act as a mortgage guarantor for low-income, first-time homebuyers.

Somewhat similar to acting as a co-signer, the proposal means that the city would agree to take on mortgages for residents who default on their payments. But while taking on some risk, Santiago’s campaign says the program would help individuals overcome credit score barriers to purchasing a home — and create new pathways to build wealth in Boston’s prohibitively expensive real estate market.


“To help folks with poor credit histories, I’m committing to using the City of Boston to serve as a mortgage guarantor to increase the buying power of clients,” Santiago said during a press conference Thursday morning in East Boston.

Santiago’s campaign said they were unaware of any other city in the country that has launched such an initiative. Typically, guarantors are a homebuyer’s parent or close relative.

His housing plan also includes a commitment for 25 percent of new development to be devoted to homeownership opportunities for individuals or families making less than $100,000 a year. And he also says the city should use its AAA bond credit rating to publicly finance affordable housing projects through the issuance of bonds.

Appearing alongside East Boston residents who spoke about seeing neighbors forced to leave the community by climbing rents, Santiago called for increasing linkage fees on commercial developments to fund affordable housing, allocating $5 million to community land trusts, and recalculating the Area Median Income thresholds used to set eligibility for affordable units to be based on the city itself, rather than the Boston area, which includes wealthier suburbs.

“We need to be doing more to protect our renters, prevent evictions, and stop displacements in our neighborhoods,” Santiago said, adding that he would expand the city’s housing voucher programs.


But with his plan, he joins several candidates in the race who have put an emphasis on supporting first-time home buying — not only to address the Boston area’s affordable housing crisis but also in an effort to close the region’s racial wealth gap by helping Black and Latino residents purchase homes.

Like most other candidates in the race, Santiago says he would increase funding for the city’s homebuyer assistance program, which Acting Mayor Kim Janey recently expanded to offer up to $40,000 to lower-income individuals to help pay for down payments and closing costs.

“As we build more and increase supply, I will double down on our commitment to homeownership,” Santiago said Thursday. “I want to see a city that reduces displacement by creating affordable homeownership opportunities, keeping residents in their communities and building wealth while doing so.”

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