ON TOP of the WORLD

“It was luck, I’m sure of it,” I tell people who ask how I managed to find my house, qualify for a mortgage and then get a no-interest city loan to renovate it. “Luck and following my heart.”

It was also having the patience to stick it out until I found the house that was exactly right for me.

What I wanted was a bungalow in the old section of L.A.’s Mount Washington that was spacious enough for a roommate if I needed one, was in decent structural condition and had a large yard.

A fixer-upper was OK, as long as the problems weren’t major, and as a writer, I considered romance essential.

The whole process took about six months. A Realtor showed me more than 30 homes, but in the end, I found the house on one of my long, meandering drives around Mount Washington. I knew the moment I saw it that it was the house for me.

Looking at my “before” pictures, I’m shocked at what I wound up with. But love is blind, and this was my first house--then little more than a shack that had evolved over 75 years from a two-room bungalow to a ramshackle, three-bedroom, two-bath house with a leaky roof.

But it had skylights, a bank of living-room windows with a panoramic view of downtown Los Angeles, a good foundation and the largest lot on the block. It also had two mature pepper trees in the frontyard.

Though I was sure about the house I wanted, I was a lot less sure of my ability to get the mortgage.

I’m a part-time English instructor at community colleges, and my income is scanty; though my credit isn’t bad, I don’t have much. I had a down payment, but that was all.

Without the confidence to walk in the front door of a major bank, I dealt with mortgage brokers, but half the time they wouldn’t return my calls. When they did, they told me I wouldn’t qualify for very much.

My first piece of luck was the housing market. This was 1996, and real estate was deep in a slump. The previous owner, a USC professor, had bought the house in 1989 for $250,000 but couldn’t sell it for what he owed on it.

I found the house just as it was going into foreclosure. The owner had moved out and the house went off the market for several months. During that time I would drive over with friends to simply lie on the grass and dream of owning it.

One afternoon my future neighbor poked his head over the fence to introduce himself. He is a lawyer and businessman, and when I confided my loan troubles, he handed me a list of “the 20 best mortgage agents in L.A.”

A week later I walked into the main branch of one of the largest banks in Los Angeles for my first meeting with its senior loan officer, one of those on my neighbor’s list.

I was nervous, but she turned out to be very aggressive and was determined to get me a loan. But my application for a fixed-rate, no-point mortgage was rejected by the loan committee because of my lack of credit.

“It is a good application,” she said to me. “There’s no reason you shouldn’t get this mortgage, and I’m going to see that you do.” She submitted it a second time and pushed it through.

The day the house went back on the market, I offered $180,000, and six weeks later we closed without a hitch.

Only then, with El Nino coming, did I focus on the roof. Decades of do-it-yourself work had given it so many gables and flat areas that rainwater had pooled in several spots, and the leaks were serious.

I never planned on a renovation--I figured I would paint the house on the weekends--but the roof had to be torn off and replaced. Several roofers gave me quotes of more than $6,000, which I couldn’t afford. So I patched and prayed.

*

Then, out of the blue, a friend told me about the Neighborhood Revitalization Program, a citywide loan program that helps owners fix up property in what the city classifies as “transitional” neighborhoods. Mount Washington qualified.

This second-mortgage loan program, run by the L.A. Housing Department, is available to low- and moderate-income homeowners. I certainly qualified.

The loans vary in size, but usually property owners can get several thousand dollars, depending on what repairs are needed. Interest rates range between 0% and 5%, depending on income. Many senior citizens in lower income brackets are not required to repay the loans at all.

The day I met with a loan officer, I was pre-qualified for a $30,000 second mortgage at 0% interest to be repaid over 20 years. With a payment of $133 a month, it was hard not to get grand ideas: I wanted new windows and doors and a stucco job to cover the crumbling bat-and-board siding.

Patience is a virtue when dealing with the city: Nothing happens overnight and you need a lot of tolerance for bureaucracy. I was quickly approved for the loan, but it took months for the loan to be funded. And when the money did arrive, it was put into an escrow account, not given to me personally.

I was required to use a city-approved general contractor. A construction supervisor, employed by the Housing Department, had to approve everything I wanted to do, as well as the work of the contractor, before any money could be paid.

My good luck continued, though. The supervisor, Steve Cundiff, was a gem. He was tremendously informed, very supportive of my ideas and really fought in my corner when I disagreed with my contractor, though that wasn’t often.

Everyone has heard of construction nightmares, but they just didn’t happen. The contractor I chose from the city’s list, Steve Kang, turned out to be very reasonably priced and honest, and his work was excellent. Property owners may also bring in their own contractors, as long as they are insured and meet the city’s standards.

It was around this time that Cundiff also encouraged me to add some of my own money, if I could, and get rid of my roof problem altogether by taking off the top of my house and re-pitching the roof--something I never would have thought of. It would cost about $15,000 extra.

By this point, my relatives were involved. Between their help and a small extra loan of my own, I was able to raise the needed cash.

My contractor knew an architect who could draw up roof plans for an unheard-of $1,500.

Living so close to nature in Mount Washington, I wanted to maintain a simple, unpretentious feel that also extended the sense of serenity on the property.

*

I’ve always loved Craftsman architecture; now was my chance. I began spending hours driving around Pasadena, taking pictures of the Gamble House and other examples of the style that appealed to me. I showed the photos to the architect, Roy Furuto of Furuto/Rubio & Associates in Downey, and explained exactly what I wanted.

For $1,500, the architect could do only basic blueprints, and certainly couldn’t help with materials. However, I was lucky enough to find a talented young designer, Juan Felipe Goldstein, who was willing to work on an hourly basis throughout construction, to finesse the plans, make new drawings as necessary and help me with decisions.

I also saved money by shopping for the windows and other materials myself. Usually a general contractor charges a percentage of the cost of the materials, but because I did the legwork, he didn’t charge me, and the window and door distributor I used, OK Manufacturing in Los Angeles, gave me its contractor discount in addition to a lot of help.

I was similarly involved in choosing the stucco finish and color, the door hardware, the porch light, etc.

It’s definitely been a learning experience, but it’s also been fun and tremendously gratifying. I am very pleased with the results.

Three years later, my luck’s still holding. Real estate prices in my neighborhood have increased up to 30%, and that doesn’t reflect the money I’ve probably made on the renovation.

Looking back, it seems like a lot of this process was blessed with luck for me, which I know is not the norm. Maybe it was because I let myself fall in love so hard, without thinking about the consequences.

Resources

For further information about this and several other neighborhood preservation loan programs, call (213) 367-9128.

Contractor: Steve Kang of Sunway Construction in Downey, (562) 927-6648.

Designer: Juan Felipe Goldstein, (323) 965-0524.

Window and door distributor: OK Manufacturing, (213) 413-6844.