Model Home Opens in Low-Income Program

What was a vacant lot six weeks ago in Watts is now home to a gleaming gray three-bedroom house.

It’s complete with all the amenities: plush carpeting, a washer-dryer set, a built-in dishwasher, even air-conditioning. And the yard is nicely landscaped, with grass and trees and delicate pink and purple flowers in a bed of mulch.

The view isn’t much--the front windows look out on Imperial Highway and the Century Freeway. But the price sure is right: as little as $500 down and about $800 per month.

It’s a good deal all around, according to city and federal officials, bankers and community activists, all of whom descended on the model home Monday to tout the benefits of home ownership in Watts.

An innovative public-private partnership is intended to help 100 low-income prospective homeowners obtain loans and find homes in Watts in the next 18 months, said Rep. Juanita Millender-McDonald (D-Carson), calling it “a critical step in restoring the structure . . . of our neighborhood.”

Stephanie Smith, a senior executive with BankAmerica Mortgage, which intends to commit at least $25 million to the program, said: “You know how things are going to get better in Watts? House by house.”

The partnership unveiled Monday is aimed at renters living in or around Watts, the historically black community in South Los Angeles that in recent decades has become home to immigrants from Mexico and Central America.

Ultimately, officials said Monday, the goal is to increase the home ownership rate in Watts from 40% to a figure closer to the national rate of 65%.

Traditionally, however, most renters in lower-income communities have been poor candidates to secure home loans.

Often, renters are too cash-poor to come up with a down payment. And, perhaps even more important, credit ratings are poor or nonexistent.

Among the loans that BankAmerica Mortgage executives said they intend to offer is one that comes with a down payment of as little as 3%. A buyer might have to pay only $500. The remainder of the down payment could come from a second mortgage provided by the city of Los Angeles’ housing department.

Those with bad credit will not be precluded from consideration, officials said, if they take part in a debt management program by an agency such as Consumer Credit Counseling Services.

Others involved in the initiative include Freddie Mac, the federal mortgage broker; the Enterprise Foundation, the national nonprofit affordable housing organization; a local nonprofit group, the Watts Century Latino Organization; Los Angeles City Councilman Rudy Svorinich Jr., whose 15th District includes Watts; and Housing Alternatives, a Fullerton-based home builder.

For the next few months, the gray model home--at Imperial Highway and Grandee Avenue--will serve as home base for the initiative. On Monday, it was dubbed the “Watts Community Home Ownership Center.” After the ceremony at the home he had built, Housing Alternatives President John A. DeFalco said: “We just have to educate the community. It’s cheaper than rent.”

Rene Vasquez, a 39-year-old truck driver, and his wife, Vilma, a 46-year-old maid, the parents of two daughters, were among the first to apply for the program. They said they intend to move into Watts from South Gate, where a $700 monthly rent check gets them two bedrooms in a duplex.

Flanked by bankers promising him the “pick of the neighborhood,” Rene Vasquez said Monday, “If I have the opportunity to [buy] here, in Watts, why not?”