Tuesday, June 12, 2012
How Not to Buy a House in La Jolla
["Let Inga Tell You," La Jolla Light, published June 14, 2012] © 2012
Let this be a cautionary tale about how not to buy a house in La Jolla. Or anywhere, really.
We arrived in San Diego in June of 1973 for my physician ex-husband to do his required two years of Berry Plan military duty. Right out of medical school four years earlier, and weeks after we had married, he’d been offered the opportunity to “volunteer” two years to the military after he finished his specialty training or go to Vietnam as a general medical officer the next week. Took us up to four seconds to decide.
Having tons of medical school loans and no actual cash, we were thrilled to learn when we arrived that we were entitled to a 100% VA home loan. That happiness was short lived when we discovered that no realtor or bank in La Jolla (our target area; we were no dopes) would work with VA loan customers. This was partly because the VA didn’t tend to appraise the value of the land, which in La Jolla is pretty much everything. But just when we were finally going to look elsewhere, we saw an ad in the Sunday paper for a for-sale-by-owner home, a total fixer, and immediately signed a full price contract on it.
Despite the crushing recession going on at the time, it was a real estate boom era. In fact, the owners made a whopping 40% on the place in the just two years they’d owned it. They probably couldn’t believe that these idiots (that would be us) were actually willing to pay that amount for a house with a dead lawn, green shag carpet, hard water stalactites hanging from the faucets and a master bedroom entrance through the kitchen. (Definitely lacked feng shui.) Who cared? We were New Yorkers; it had a palm tree and a pool. We could have happily overlooked plutonium deposits for the palm tree alone.
Miraculously, the VA appraised the house for the full asking price so we could get our 100% financing which was pretty amazing because 100% of everyone else said, “You’re paying WHAT for that dump? You’ll NEVER get your money out of it!” (I should note that our collective parents were among those people.)
The appraisal was the last nice thing we had to say about the VA, an institution which quickly made both us and the owners homicidal. Within days, the owners tried to get out of the contract and take one of the over-the-asking-price cash offers that had subsequently come in. Among the VA’s many requirements was that the house have a driveway which this one did not because of the garage conversion years before. So here’s the first rule I always tell prospective home owners: Never put in a driveway on a house you don’t own. But penniless and in love (the pool!), my ex and I spent several weekends digging a driveway on someone else’s house then having concrete poured. (Nearly four decades later, just looking at that driveway makes my back hurt.)
The owners kept telling us that if this deal fell through – which it was in danger of doing pretty much daily – they weren’t going to reimburse us for all the VA-required improvements we seemed to be adding to their home on a tragically regular basis. At one point, for example, the VA said they couldn’t approve the loan because the underside of the eaves weren’t painted. We spent an entire weekend on ladders while the owners were having a pool party. One guest tried to hire us to paint his house not realizing our true roles. (He commented that not only did we do good work but our English was excellent.)
But ultimately, two long, trying, expensive months later, the closing date came around. We showed up with our $700 cashiers check for closing costs only to have the evil troll bank folks suddenly flip us for $1,700. The owners had made it clear that not one more extension was going to be granted. This was a serious crisis. We’d barely been able to come up with the $700 since all of our spare cash had been going to improve a house that it now looked like we were never going to own. But one of the advantages of being a doctor is that banks will lend you $1,000 pretty much on the spot. It was finally really going to be ours!
Er, not. It was now one p.m. on closing day and the VA loan guy suddenly realizes that the roof certification statement says “the roof should last five years” instead of “the roof WILL last five years.” All of which was immaterial since the roof had seen its last good day at least a decade earlier judging by the rain damage on the living room wall. We immediately called the roofer whose wife said he was out in Alpine. We jumped in our car and actually located the guy and got him to change “should” to “will” and were back at the bank by 4:00 for Closing (Take 3). We (and the bank) finally owned the place in all its decrepit over-priced glory.
But let me be clear: no one should ever ever do this. Of course, I got to buy this house again ten years later when my ex and I divorced. But by that time, there was no way I was letting that driveway go to someone else.