Helping Renters Become Owners

Construction worker Robert Olmos sat on his throne--a beige couch--and nodded in approval as he surveyed his new domain. At 52, for the first time in his life, he is a homeowner.

“I’ve been in apartments all my life, and now it’s like I won the lottery,” said Olmos, who recently took ownership of a Pacoima condominium on Osborne Street. “Now I can say this is mine.”

But it wouldn’t have been his without HOMEWORKS!, a city program designed to help low-income, first-time buyers purchase and rehabilitate homes, condos and townhouses.

Olmos rented the two-bedroom, two-bath condominium for five years and the landlord had offered to sell it to him several times. But Olmos, who makes about $30,000 a year, could never afford to purchase the $98,000 unit. He had tried traditional lenders but never qualified.

Then his nephew told him about Los Angeles Neighborhood Housing Services, a nonprofit lender and community developer dedicated to building stronger neighborhoods through homeownership.

“He came to the Pacoima office and said he wanted information about buying a home,” said Jorge Valle, a coordinator at the housing services. “I told him about some programs that might help him. He was a little skeptical.”

But thanks to Neighborhood Housing Services, and HOMEWORKS!, which the agency helps administer, Olmos qualified for a loan to purchase--and an additional $20,000 for improvements.

That’s not all. Olmos will pay no interest. He will be required to repay in full only if he sells the house or refinances within 30 years.

“Like any traditional lender, we evaluate the client’s credit history, income, employment and residency status,” said Jerry Munson, senior credit officer of Neighborhood Housing Services, headquartered near USC. “People who normally couldn’t afford to, now can have a house.”

The program began in 1997, and three years later the loan maximum was increased from $35,000 to $75,000. Since then, 30 loans have been approved throughout the city. To qualify, a family of four cannot have an annual income of more than $44,100, which is 80% of the county’s median family income.

The buyer must pay a 3% down payment and closing costs. But if the buyer attends eight hours of home buyers’ education courses, only 1% is required. Olmos’ down payment was less than $900.

“It’s the best thing since sliced bread,” said Doug Smith of the Los Angeles Housing Department. “We make home buyers’ dreams come true for people who normally could not afford to buy a home.”

Six other lenders are part of the HOMEWORKS! program: Allwest Mortgage in North Hollywood, Cal Fed Bank in Bell Gardens, California Bank and Trust in Torrance, Family Savings Bank in the Crenshaw district, Hawthorne Savings in Gardena and Irwin Mortgage in Long Beach and Carson. The purchased properties must be in Los Angeles.

“I can’t understand why more people don’t know about this program,” Olmos said.

Word of mouth about the loans is slowly spreading, Valle said.

“It’s like there’s a rich uncle out there and no one knows about him,” he said.

“Being a homeowner, it makes you want to be more involved in the community,” said Olmos. “It’s not like you’re just passing through. Now I’m stuck here in Pacoima. But that’s a good thing.”