Tuesday, September 04, 2007

The House-Hunting Chronicles: The Prequalification

as i tell friends that i’m interested in buying a place, i’m often met with a look that seems to say, “damn, girl, i didn’t realize you made THAT much money!” truth is i don’t make THAT much money. in fact, i barely make THIS much money. and, as counterintuitive as it may seem, my lack of money is the one thing that will make homeownership affordable for me.

pretty much all the first-time homebuyer guides i read through in preparation for this quest said the same thing: check with your state’s housing authority, which provides great incentives for first-timers, to find your mortgage. so i checked and wow — down-payment assistance, gap financing, deferred junior loans and, the deal-sealant, a 40-year fixed mortgage at a below-market rate. and in this ridiculously wealthy county of Los Angeles, my salary places me in the low/moderate income bracket, meaning i qualify.

though that’s not the same as prequalifying for the loan, which can only be achieved through mondo paperwork and a thorough credit check. for my appointment with the mortgage broker specializing in these ghetto loans, i came equipped with documents galore: three years worth of W-2s, tax documents filed with the IRS, pay stubs, IRA account statements, quarterly statements for my investments, checking and savings account documentation, my passport and any other outstanding loan or asset documentation i could provide. then came a blood test, a urine test and a hearing exam, followed by the inner-ear culture, pap smear and rectal swab — concluding with a quiz on Rorschach inkblots.

and then something weird happened. “uh oh,” said the mortgage broker while looking at her computer screen. immediately i froze because nothing is more frightening than hearing “uh oh” from someone about to loan you a bunch of money. “uh oh?” i asked cautiously while trying to clear the quiver out of my throat.

“well,” she began, “part of your mortgage is provided by the state of California and the other part is taken care of by the city of Los Angeles, and it looks like the city ran out of money.” ghetto indeed.

of course the city-sponsored part of my mortgage is the good part — the zero-interest, deferred junior loan, gap financing portion that i only need to repay once the principal mortgage supplied by the state is paid off (in 40 years!), meaning i need that city money BAD. that’s the part that really gives me “purchasing power,” mortgage broker said.

she also said the fund would be replenished by the government, eventually, and that i would need to wait. ok, so now i wait through a subprime mortgage meltdown for the government to pour money into a depleted fund set aside for low-income homebuyers. yeah, i’m sure that’s a real high priority right now.

but wait i will, as i simply have no other choice. mortgage broker assures me it won’t take more than a few months for the new funding to come in, despite her admission that she’s never known this to happen before. in the meantime, i would be put on the wait list, which, yes, is already lengthy.

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