Opening New Doors

Kathleen and Eric Sais, parents of twin boys, were renting in Fullerton two years ago and trying to scrape together a down payment when Kathleen discovered a program that helped get them into a home sooner than they’d dreamed possible.

She knew her family’s moderate income was too high to qualify for Fullerton’s home-buying assistance for very-low-income households. But when she saw a house she liked in La Habra, she called city officials to ask whether they had any programs for low- to moderate-income families.

The city referred her to Neighborhood Housing Services of La Habra--now called Neighborhood Housing Services of Orange County. With the help of a second mortgage from NHS, the Saises bought a five-bedroom home in La Habra, bordering the city of La Habra Heights.

“I don’t know why people go through the bank themselves,” said Kathleen. “[NHS] not only educates you and makes you aware, it can get almost anybody into a home.”

Through a combination of home buyer education programs, loans and even some grants, the seven Neighborhood Housing Services organizations serving Southern California created about 780 new homeowners in 1998.

NHS offices are located in Los Angeles, Inglewood, Pasadena, Montclair, Orange County, the Inland Empire and San Diego.

A newly affiliated organization, the nonprofit Cabrillo Economic Development Corp., serves Ventura and Santa Barbara counties.

“A lot of people are surprised and delighted when they realize there are resources out there designed to respond to what they need,” said Ed Moncrief, executive director of San Bernardino-based NHS of the Inland Empire.

In the first half of 1998, Inland Empire NHS led the nation in creating new homeowners, with 183. Moncrief said his group helped 315 new homeowners by the end of the year.

The Southland NHS offices and the Cabrillo Economic Development Corp. are part of NeighborWorks, a 189-member nationwide network of organizations whose mission is to restore neighborhoods in decline and help low- and moderate-income people become homeowners.

With the support of the federally chartered nonprofit Neighborhood Reinvestment Corp., NeighborWorks groups have been forging partnerships among local residents, governments and businesses for more than 20 years.

Their efforts in the Southland got a boost this month when a congressional grant program awarded $2.2 million to support local homeownership programs.

At the core of the NeighborWorks mission is home buyer education--eight hours of classroom work offered at night and on weekends.

Any prospective home buyer, regardless of income level, may attend the classes. But to be eligible for many of the loan products offered by lenders affiliated with NHS groups, buyers must meet income requirements.

Income Qualification

For example, to qualify for some loan programs, a Los Angeles County family of four can have annual income of no more than $61,560, which is considered “moderate income.” In Orange County, the maximum income for a family of four is $65,800.

Income limits for loan programs vary by county and by organization.

Similarly, although residents of any city may attend home buyer courses at any NHS, services such as down-payment assistance and second mortgage loans may be available only to those for purchasing in certain cities. Buyers should check with the NHS nearest them.

NHS officials say they have helped many home buyers who may not have thought they were qualified for low- and moderate-income assistance.

“The whole gamut of home buyers comes through here,” said Margaret Grayson, director of Neighborhood Partnership of Montclair.

Her group helps people buy homes in Montclair, Pomona, Chino, Upland and Ontario with as little as 3% down and provides a variety of other services, such as home improvement loans and home maintenance classes.

None of the NHS organizations has much to spend on advertising. They rely instead on word of mouth and in-the-know Realtors to refer clients to them. But even with little advertising, most offices report seeing lots of prospective home buyers.

To qualify for benefits such as 95% to 97% financing, NHS organizations require that potential home buyers spend about eight hours attending home buyer education classes.

During the sessions, participants learn “everything you would want to know” about home buying, said Saundra Knox of the Pasadena NHS, including how to minimize credit problems, calculate how much they can afford to pay for a home, work with a real estate agent, shop for a mortgage and navigate the paperwork associated with purchasing a home.

After completing the classes, participants receive a certificate stating that they are eligible for Fannie Mae and Freddie Mac loans that require as little as 3% down.

Eric and Kathleen Sais, who own a trucking company, were able to put 10% down on their $210,000 house, a fixer-upper in foreclosure.

With a second mortgage from NHS of Orange County, they were able to put 20% down and avoid private mortgage insurance, which would have pushed their monthly payments out of reach.

Most of NHS’ clients are first-time buyers, although anyone who has not owned a home for three years may participate in the program.

Inglewood resident Gary Chapron took advantage of both an NHS second mortgage and a home rehab loan, a service offered by many NHS offices.

Chapron, 40, a manufacturing planner for Northrup Grumman, spent “every day, every night, every chance I had, seven days a week” tearing apart and then rebuilding the three-bedroom fixer he bought in June 1998.

Seven months later, his house has new plumbing, a new heating and cooling system, new floors, new everything--90% of which he installed himself using home repair books.

“I was really determined to get this house together,” said Chapron, who put 3% down on the $150,000 house.

Some NHS offices offer down payment and closing-cost assistance to those for whom the 3% down is a stretch.

But that doesn’t mean homeownership comes right away to all NHS clients.

It may take some participants up to two years to clean up their credit and save enough for a down payment or at least closing costs, said Martina Guilfoil, executive director of Inglewood NHS.

The 20-year-old Inglewood organization in October opened a new HomeOwnership Center, which provides clients with “one stop” access to services related to shopping for, purchasing, rehabbing and maintaining their homes.

“When someone walks in [to NHS], they feel like they can start hoping and wishing,” Guilfoil said. “When it comes true for someone, it’s transformative; you can see it on their faces.”

Community in Mind

Each independently operated NHS office offers services tailored to fit the needs of its community, many of which are designed to act as a “catalyst for neighborhood change,” according to Lori Gay, head of Los Angeles NHS.

For example, Pasadena offers entrepreneurial development classes and home loans for buyers with disabilities; Inglewood holds leadership development courses; and Inland Empire develops loan products with new home builders and will soon begin training young people in construction trades.

Orange County rehabilitates apartments and operates an after-school tutoring program for elementary school children. Montclair makes grants to seniors for minor home repair. Los Angeles, the largest NHS on the West Coast, attempts to reach more participants by holding home-buyer classes at local businesses, and establishes block clubs in targeted neighborhoods.

Each NHS office holds an annual Pride Day, during which volunteers paint and repair rundown homes.

San Bernardino residents Clint Brown, a furniture mover, and his wife Yolanda, a part-time postal worker, learned about NHS after Yolanda’s mother picked up a flier on a city bus.

The couple dreamed of buying a home but lacked enough savings to pay outstanding bills and make a down payment.

After attending home buyer education and home maintenance classes, they received $12,450 in down payment assistance from NHS of the Inland Empire. In January they bought a two-bedroom house that the NHS owned and was in the process of rehabilitating.

“Without Neighborhood Housing, it would have been very, very difficult” to buy a home, said Yolanda, 36.

If the Browns live in their house for 30 years, they do not have to repay the $12,450.

“A lot of people don’t believe there’s actually help out there,” Yolanda Brown said. “The girls at work, they ask me every day, ‘You think I could really own a home?’ I say, ‘Look at us, you know?’ . . . You’ve just got to believe.”

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HELP FOR FUTURE HOMEOWNERS

Southland Neighborhood Housing Services/NeighborWorks offices offer services to prospective home buyers and to current homeowners. Programs vary by office but may include down-payment and closing-cost assistance, home-rehabilitation loans and home-maintenance classes. For more information, contact the nearest organization:

* Cabrillo Economic Development Corp.

(805) 659-3791, 11011 Azahar St., Saticoy (Covers Ventura and Santa Barbara counties)

* Inglewood Neighborhood Housing Services

(310) 674-3756, 335 E. Manchester Blvd., Inglewood

* Los Angeles Neighborhood Housing Services

(888) 895-2647, (213) 749-7797, Main office: 3111 S. Flower St., Los Angeles. Other locations: 3268 W. Slauson Ave., Crenshaw; 11243 Glenoaks Blvd., Room 3, Pacoima; 501 Mesa St., San Pedro

* Neighborhood Housing Services of the Inland Empire

(909) 884-6891, 1390 North D. St., San Bernardino

* Neighborhood Housing Services of Orange County

(562) 694-2051, 350 Hillcrest St., La Habra; (714) 547-7143, 1617 W. 7th St., Santa Ana

* Neighborhod Partnership of Montclair

(909) 624-9110, 9916 Central Ave., Montclair

* Pasadena Neighborhood Housing Services

(626) 794-7191, 456 W. Montana St., Pasadena

* San Diego Neighborhood Housing Services

(619) 229-2370, 4336 54th St., San Diego