SAN FERNANDO JOINS LEASE-PURCHASE PROGRAM.

Byline: Gregory J. Wilcox Staff Writer

SAN FERNANDO - Middle-income families in San Fernando got a new home buying opportunity Monday when the city joined a nonprofit agency that offers a lease-purchase program.

The California Communities Housing & Finance Agency effort addresses some of the major barriers to buying a home, especially in the current high-priced environment.

Qualified buyers don't have to make a down payment or pay closing costs, and credit requirements are more flexible than in a normal home loan. The home is owned by the agency and participants have between 12 months and six years to exercise the purchase option.

At that point they can choose the best financial arrangement - assume the original mortgage or take out a new loan.

During the lease phase, participants don't get the interest rate tax break but household repairs are paid for by the agency.

The purchase price is capped at $475,000, but there is no limit on the number of participants.

``Local governments are trying to find ways to help working people buy a home locally, and there are big obstacles to homeownership,'' said Matt Callahan, program administrator for the housing and finance agency. ``But even bad credit is acceptable in our program if (applicants) can demonstrate they have been paying their rent on time.''

A pilot program was tested in 2000, and the current version implemented in June. San Fernando is the 19th city to sign up with the agency's program. Other participating cities in the San Fernando Valley area are Santa Clarita and West Hollywood.

For the complete list, visit www.dailynews.com.

Participants don't have to live in any of the cities, but they do have to buy property there.

A similar effort undertaken in Fresno at the end of last month has already attracted 3,000 applicants, Callahan said.

San Fernando Mayor Maribel De La Torre, the agency's chairwoman, said that residents inundated city hall phone lines shortly after television broadcasts of Monday's news conference addressing the program.

The city's median price is about $330,000, she said, making it one of the more affordable areas in Los Angeles.

``I think there is a lot of opportunity for (renters) to turn around and purchase the homes they are renting,'' she said.

Gregory J. Wilcox, [phone]

greg.wilcox(at)dailynews.com

LEASING TO BUY

Here are some key elements of the California Communities Housing & Finance Agency homeownership program.

--The agency pays all closing costs.

--Credit requirements are relaxed. Even if applicants have serious credit problems, a good history of rental payments can be enough to qualify.

--The lease period can be used to improve a credit record.

--The agency can be reached at [phone] or www.calcomhfa.org.

Source: California Communities Housing & Finance Agency.

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LEASING TO BUY (see text)