Charity Begins at Home for Elderly Widow

The tiny Lakewood bungalow that Mary Hay has called home for 46 years isn’t fancy.

But it certainly seems like a palace now that leaders of a Los Angeles charity have knocked on her front door to explain the unusual steps they are taking to keep a bank from foreclosing on it.

The Easter Seal Society is purchasing the house, paying off its steep fourth mortgage and cheaply renting it back to her so that the 84-year-old widow can continue living there the rest of her life.

“Thank you,” she said. “Thank the Lord.”

Hay, disabled by a broken hip and an amputated leg, had repeatedly refinanced the two-bedroom house in recent years to pay for in-home care. But she ran out of money two months ago and had to let her helpers go when she was unable to refinance her mortgage a fifth time.

Since then, friends have visited her house daily to assist with meals and housekeeping. They watched nervously as Hay--who lives on a tiny pension and Social Security checks--fell behind on her $1,200 monthly mortgage payment and slipped precariously close to foreclosure.

One of them called Easter Seal officials after remembering a recent telethon during which operators of the charity discussed a fund-raising technique called income-for-life trust. It is a method in which donors can turn over property, stocks or other assets to a nonprofit group and still benefit from interest payments.

Easter Seal financial planning director Michael Flory quickly determined that Hay didn’t qualify for that--such trusts are only for unencumbered property. But he came away taken by the feisty widow and her love of her home.

“My husband Bob and I picked this house before they finished building it,” she said Friday as she signed over the deed. “We moved in the day after they finished it. It was wonderful. It was our first house.”

Bob Hay, who was a harbor warden at the Los Angeles Harbor, died in 1971. By the 1980s, Mary Hay, a former beautician, had paid off the original mortgage. But a series of medical problems of her own would soon force her to start borrowing money against the home’s equity.

Her friends say Easter Seal’s intervention came just in time. The organization’s goal is to help people with physical and emotional disabilities have maximum independence.

The Rev. Roger Lautzenhiser, pastor for 32 years of Lakewood Village Community Church where Hay is a member, feared that she would not survive long in a nursing home if she was evicted. Members of his congregation are the ones who have watched over the woman since she lost her paid helpers.

“She’s a gutsy woman. But I didn’t see how she was going to stay in her house much longer,” Lautzenhiser said. “She wouldn’t be happy a single day in another place.”

Flory said the $550 a month rent that Hay will pay will leave her with enough cash to rehire her professional helpers and cover other expenses. He said Easter Seal will recoup its $120,000 investment in the future when it can sell the house. Originally priced at about $8,500, the dwelling is worth about $175,000 today.

He said the charity could end up buying other seniors’ homes and then leasing them back to them if the Lakewood experiment is a success. Four other elderly members of Lautzenhiser’s church have already expressed interest in similar arrangements.

Experts in nonprofit organizations said the effort is unique.

“We’ve never heard of it. It’s a terrific idea,” said David Ackles, executive director of the National Society of Fundraising Executives’ 400-member Los Angeles chapter.

Janice Burrill, a Los Angeles banking executive who is president of the 300-member Planned Giving Roundtable of Southern California, said she has not heard of a charity assuming someone’s debts before, either.

“It’s an interesting idea,” Burrill said. “Some people don’t linger long when they’re forced out of their home.”

Hay agreed. “I’d rather stay right here under the same good roof I’ve lived under all these years,” she said.

“Before, sometimes I couldn’t sleep a wink at night worrying about the money problems I had. I’m going to sleep well tonight.”