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Readers Tell How They Bought First Homes : GETTING IN: A follow-up report on how to buy a first home in today's tight real estate market.

June 25, 1989

When we published our special report last month on buying a first home, we asked you to tell us how you bought your first house--and did you ever.

The Times received dozens of responses from readers across the Southland, some of which appear below. By and large, most of the letter writers did exactly what the experts in the article advised today's would-be buyers to do:

Scrimp and save to raise a down payment and don't expect to get a "dream home" the first time out.

Nearly all the readers who wrote say they made compromises to buy their first home. Some purchased "fixer-uppers," others bought lower-priced condominiums and a few even weathered the often-frustrating process of buying foreclosures.

A few bought their first home utilizing more offbeat methods. One purchased a house with a co-worker nearly four years ago, and they are still sharing the home today. A married couple borrowed money against their life insurance policies to help with the down payment.

But some things never change: About half the letter writers said they got at least some of the money for their down payment from their parents.

Here is a sampling of helpful advice from readers to readers.

-- The Editors

My wife, a registered nurse, and I, a loan officer, bought our first home in December of 1985 in Pico Rivera in a new tract.

There are about 225 homes, averaging 1,473 square feet. The houses were being sold at $132,000. We only put in 5% down plus closing cost; our total cash out was $12,500. Our loan amount was $125,000.

Although our housing ratio was acceptable, our total debt ratio was high due to the fact we were paying for two cars. The loan officer suggested that we could still qualify if we had another co-borrower. My wife had a college classmate who was single and also a registered nurse. With her as additional co-borrower we easily qualified for a $125,000, 30-year loan graduated payment mortgage (GPM).

Our down payment was borrowed from my brother, who executed a gift letter. A couple of months after the loan closed I prepared a quitclaim deed, which was signed by our co-borrower friend. After recording the same with the County Recorder, my wife and I are the only title holders on record. Homes in our tract are now listed at $225,000. We repaid the borrowed down payment from a tax refund.

JOE DIAZ

Pico Rivera

I saved for years before finally purchasing my own home. And, like many young people starting out, I looked at condos and townhouses, but I managed to get a single-family home.

I'm single and have worked in the financial services industry for five years. As each year went by, my savings grew, but I felt like I was continually falling behind in the real estate market. Finally, I decided now is the time--regardless of what type of property that I could afford. I was already late getting into the home buying game, and if I waited much longer, I wouldn't even be eligible to play!

I recommend to any first-time home buyer:

1. Do the dirty work. Save for the down payment or find one of those equity-sharing deals or whatever it takes to make such a large investment. I took advantage of my employee loan benefits program (no points, discounted interest rate, etc.) and some help with the down payment from my family.

2. Know why you are buying. What are your priorities? What is most important to you and what can you live without? My priorities were investment first, place to live second, comforts/extras third. Knowing your priorities can be invaluable in helping you make your final decision--because compromise is inevitable.

3. Prepare yourself psychologically as well as financially to buy. It's a gutsy move that shouldn't be taken lightly, but in today's market "He who hesitates is lost."

4. Get a good agent. Mine was tops. Her name is Karen O'Connell, and I would recommend her to anyone looking for a single-family home in the Glendale/La Crescenta area. I think the good agents rely on referrals and will do their best to have long-term, happy clients. Tell your agent everything you can about what you can afford, what you want and again, what your priorities are. They can also help educate you on what the market is doing, what price range is realistic.

5. Be patient and keep an open mind. I was patient and it worked. I put in an offer, a counteroffer was made and within hours they had already received several other higher bids. The offer they accepted from someone else fell through, so I resubmitted my offer and they accepted.

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