Steps Toward Home
Maria Shelton had always longed for a home of her own, but she despaired of ever getting out of the rented Riverside garage where she and her son had lived for four years.
Shelton, 54, does housekeeping and provides in-home care to the elderly. She earns a limited income and had only modest savings.
“When you don’t have money, nobody wants to work with you,” she said.
Then one day she was cold-called by a local lender who said she qualified for a mortgage. She didn’t think she had enough for a down payment, but the call piqued her interest, so she let the lender put her in touch with a real estate agent.
Shelton wasn’t impressed with the houses she saw. “Everything [the agent] showed me was ugly and dumpy,” she remembers.
But the idea of homeownership had been planted, and a friend told her about an unusual home-buying center in nearby Moreno Valley.
Just a few months later, thanks to a low-income ownership program, Shelton no longer rented a garage; she had one of her own, and a house to go with it.
On Sept. 16, Shelton, her son Shawn, 12, and their three dogs moved into their $80,000 three-bedroom, 2 1/2-bath home in Perris.
“It’s beautiful,” she said. “I can go upstairs and downstairs. I can actually move around in it.”
The elbow room is precious to Shelton. The garage where she and her son lived was sectioned off into two bedrooms, a bath and a living room-kitchen, but it wasn’t much of a home.
“It was a box,” Shelton said. “It was small; there was nowhere to go. People said it was cute, but they were being nice.
“I love my new home,” she said. “We are so blessed.”
The program that helped make Shelton’s dream come true is HomeSteps Asset Services--the real estate unit of Freddie Mac, one of the nation’s largest investors in residential mortgages.
When mortgages go into foreclosure, Freddie Mac often winds up with the homes, which it sells to help recover some of its losses.
More than 17,000 houses were sold through HomeSteps to families across the country in the last two years; most of the buyers, like Shelton, earned low to moderate incomes.
HomeSteps has about 1,200 homes available in the five-county Southland area. Prices range from the mid-$70,000s to the mid-$200,000s. The average sales price is $139,000.
Because parts of the Inland Empire are still shaking off the mid-’90s real estate slump, Freddie Mac’s sales affiliate there took the novel approach of opening a one-stop sales center to help speed up sales.
Staffed by Baldwin Realty, a local company, the office allows would-be buyers to shop for HomeSteps properties electronically by location, property type or price.
Buyers also can order carpeting and upgraded appliances at the sales center, and special financing is available for many of the properties.
Shelton didn’t need the upgrades, however. As part of its effort to instill buyer confidence in properties that are often left to deteriorate by previous owners, HomeSteps had already installed new carpets, vinyl flooring, a stove, plumbing and electrical fixtures. And it had given the place a fresh coat of paint.
Lacking funds for a down payment, Shelton took advantage of a financing package that included a 95% first mortgage and an interest-only second lien held by a private investor.
HomeSteps waived private mortgage insurance, a costly add-on that borrowers with little cash are normally required to purchase. And it kicked in some extra money to cover her closing costs.
Shelton’s house payment is $860 a month for the first and second mortgages. “It’s a little bit of a stretch,” she said, “but it’s the first bill I pay every month.”
Lew Sichelman is a syndicated real estate columnist. He can be contacted via e-mail at LSichelman@aol.com. Distributed by United Feature Syndicate.
Find Out More
For more information about HomeSteps, call (800) 972-7555. Callers will be sent a complete listing of available homes in the area, plus names of the listing agents. Brochures about special financing options, in English or Spanish, also are available. The HomeSteps Web site is https://www.homesteps.com.
