Coruscation

Jack Guttentag, who runs an advice site called the Mortgage Professor and has retired as a business professor at the University of Pennsylvania Wharton School, likens choosing a lender to picking wild mushrooms. "You don't go out by learning to identify all the bad ones," he said. "You identify some good ones, and you go and pick those." But, he added, "some lenders are not so great, and they have some really good loan officers."

Other governmental and quasi-governmental sites may be helpful. The National Mortgage Licensing System has a consumer access site that allows visitors to check the backgrounds of mortgage professionals. The Federal Deposit Insurance Corporation site has a worksheet to help consumers compare lender policies.

But Mr. Guttentag says you can't always rely on recommendations on review sites or mortgage listings sites. These can be paid for or written by friends of the mortgage lender, he said, adding that the same holds true for complaint sites, which are often created with a particular business as a target.

Another problem with the complaint sites, he said, is that larger companies often draw more complaints simply because of the large volume of business they do. "In many cases they're not justified," he said.

REAL ESTATE
Vetting the Lender
By VICKIE ELMER
Published: September 22, 2011
Industry experts suggest that borrowers focus more on the individual who would be their mortgage broker, loan officer or loan originator.

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My family has owned four Civics over the last 20 years. Every month I pay $347.66 on my daily driver, a Civic Si sedan I bought new back in 2008. With this new, indifferent Civic, alongside the hulking second-generation Pilot sport utility; the Insight, a cut-rate Prius clone; and virtually all of the current Acura models, Honda seems intent on eradicating its own distinctiveness.

Where is the Honda that built the sophisticated Prelude sporty coupe, the intuitive S2000 roadster, the overachieving Integra Type R and the world-beating NSX supercar? The Honda where keeping things simple also meant better quality, thoughtful detailing, exquisite engineering and delightful mechanical operation?

I want that Honda back.

AUTOMOBILES
Mild-Mannered Redesign Lands in a Tough Neighborhood
By JOHN PEARLEY HUFFMAN
Published: September 23, 2011
The somewhat-new ninth-generation Civic has arrived in a competitive market and is mostly a mild revamping of the coupes and sedans that went on sale for 2006.

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Take the 1968 decision by New York Mayor John V. Lindsay to hire the RAND Corporation to streamline city management through computer models. It built models for the Fire Department to predict where fires were likely to break out, and to decrease response times when they did. But, as the author Joe Flood details in his book "The Fires," thanks to faulty data and flawed assumptions -- not a lack of processing power -- the models recommended replacing busy fire companies across Brooklyn, Queens and the Bronx with much smaller ones.

What RAND could not predict was that, as a result, roughly 600,000 people in the poorest sections of the city would lose their homes to fire over the next decade. Given the amount of money and faith the city had put into its models, it's no surprise that instead of admitting their flaws, city planners bent reality to fit their models -- ignoring traffic conditions, fire companies' battling multiple blazes and any outliers in their data.

The final straw was politics, the very thing the project was meant to avoid. RAND's analysts recognized that wealthy neighborhoods would never stand for a loss of service, so they were placed off limits, forcing poor ones to compete among themselves for scarce resources. What was sold as a model of efficiency and a mirror to reality was crippled by the biases of its creators, and no supercomputer could correct for that.

OPINION
Not-So-Smart Cities
By GREG LINDSAY
Published: September 24, 2011
Pegasus Holdings, a Washington-based technology company, will build a medium-size town on 20 square miles of New Mexico desert, populated entirely by robots.

Greg Lindsay is a visiting scholar at the Rudin Center for Transportation Policy and Management at New York University and the co-author of "Aerotropolis: The Way We'll Live Next."

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In Montclair, NJ, where there is a concerted emphasis on thinking of the town as one diverse whole -- children are bused to "magnet" schools, and the moniker "Upper" is discouraged as divisive -- several agents resisted comparisons of trends on the two sides of town.

"Sometimes people come in saying they only want to buy in the one ZIP code, 07043," said Linda Grotenstein, an agent at Coldwell Banker. "I usually find they have a misunderstanding of what the ZIP codes imply."

The housing stock is more homogeneous in the northern half: mostly well-groomed Victorians with three to six bedrooms. The south end has far greater range: everything from run-down, run-of-the-mill triplexes on narrow lots to peerless mansions on manicured grounds, in the "estate section."

In fact, by Mr. Baris's reckoning, the estate section in the southern part of Montclair has kept overall average sales value afloat. It had 42 listings this year, and 18 houses sold, at a median price of $1.218 million, 31 percent more than last year.

"If you took out the estate section," Mr. Baris said, "Montclair would have depreciated as a town."

In Millburn/Short Hills, Ms. Bigos ascribes the huge price disparity to the teardown craze that swept Short Hills starting in the late 1990s.

"That is when the spread started to widen," said Ms. Bigos, a lifelong resident of Short Hills. "All the new houses going up doubled and tripled in value."

Both Millburn and Montclair have Midtown Direct New Jersey Transit train service to Manhattan, which various reports have shown can increase property value by as much as 20 percent. Millburn has had it for 15 years, while the service arrived in Montclair seven years ago.

REAL ESTATE
One Town, but Two Markets
By ANTOINETTE MARTIN
Published: September 22, 2011
In places like Montclair and Milburn, one part of town is faring better than another when it comes to home sales.

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New York State charges a mortgage recording tax of 0.5 percent of the loan, and with other special taxes added in, New York City residents pay a total of 1.8 percent on loans under $500,000, state tax included, and 1.925 percent for those at or above that amount. Among the various counties, total mortgage taxes in Westchester and Rockland run 1.3 percent, while in Nassau, Suffolk, Dutchess, Orange and Putnam it's 1.05 percent.

There is no mortgage recording tax in New Jersey or Connecticut, according to Michael Moskowitz, the president of Equity Now, a direct mortgage lender. Co-op owners are also absolved from paying, because they hold shares in a building rather than real property, explained Lawrence F. DiGiovanna, a Brooklyn real estate lawyer.

But for those who are hit with this tax, it can certainly add up at the closing. On a $450,000 refinanced loan, a borrower living in New York City can expect to pay an additional $8,100.

Instead of granting and recording a new loan when a borrower refinances, the assignment process transfers a mortgage to a new lender, which then revises it. Lenders sometimes call the process a "Consolidation, Extension or Modification Agreement," or "Modification, Extension, Consolidation Agreement."

It's important to inquire about a mortgage assignment at the very beginning of the refinancing process, mortgage experts say, because locating and transferring all the necessary paperwork could be time-consuming. If the mortgage has been sold or handed off to a servicing company, the homeowner must get that company to sign on.

Once borrowers have determined that their new and old lenders will work with them on the loan assignment, they must "understand what the potential savings are and weigh that against the overall cost of doing this," said Marc Kunen, the Manhattan branch manager for Mortgage Master, a mortgage banker.

Even though most banks have established procedures for assignments, sometimes there are snags that can add days or weeks to the process. "Do not lock in your rate until you understand what the time parameters are expected to be," Mr. DiGiovanna said.

He also suggests that borrowers examine the new lender's commitment letter, so they understand the stipulations that need to be met for refinancing.

Occasionally banks will not be able to locate an original loan and related documents. If the original lender still is operating, those documents can be recreated, said Stephen Chiaino, an associate in Mr. DiGiovanna's law firm. The new lender probably will not accept the homeowner's documents, unless they are certified copies, he added.

REAL ESTATE
Saving on Mortgage Taxes
By VICKIE ELMER
Published: September 15, 2011
Homeowners looking to refinance could save thousands of dollars in mortgage taxes by having the loan transferred to the new lender, a process known as a mortgage assignment.

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If you ask 10 people where the BEST meal they've ever had was, 9 out of 10 will say their Grandmother's house and the odd man out will say his Mother's. Only some asshole from the yelp generation is going to say Per Se. For lack of a better comparison... Some of your friends like tall skinny meatpacking types who look like geometry problems #PerSe. Some of your friends like strange Asian women from Williamsburg who wear men's shoes #FattyCue. Then there are the guys like myself who like girls with the 40 oz bounce #PiesnThighs. 4-star, 1-star, $25 and Under... Like Pokemon, I just want to catch em all.

Eddie Huang tribute to Sam Sifton

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If your loan is owned by Fannie or Freddie, you may qualify for the Home Affordable Refinance Program, or HARP. Some 2.5 million to 3 million homeowners may be eligible to use HARP, according to government estimates -- provided, among other things, that they have not been late on their payments more than once in the last 12 months.

Instead of the 80 percent loan-to-home-value required in most initial mortgages today (the remaining 20 percent comes from your down payment), HARP loans offer up to 125 percent, to cover the home's shrunken value. That means a home appraised at $500,000 could warrant a loan of up to $625,000, if the owner's income was sufficient to repay it, instead of the maximum $400,000 in most conventional mortgages.

Federal Housing Administration loans also have refinancing options. One of them, the F.H.A. Short Refinance option, requires the lender to write down at least 10 percent of the remaining balance of the loan and the homeowner to be current on payments, among other requirements. Still other programs are available for people who have lost their jobs.

If your loan is held by a bank or has been bundled up and sold to an investment group, your options may be more limited. "It is case by case," Mr. Hackett said. You may need to call around to locate other lenders willing to refinance underwater loans.

Lenders like Atlantic Home Loans have started offering loans with lender-paid mortgage insurance, and will refinance at 95 percent of the value, Mrs. Sweet-Kostoplis said. She added that one of her clients reduced her mortgage payment by $850 a month when the rate came down to 4.5 percent from 6.7 percent.

REAL ESTATE
Refinancing While Underwater
By VICKIE ELMER
Published: September 1, 2011
Homeowners may qualify to refinance their mortgages through a variety of government programs aimed at avoiding late or partial payments or foreclosure.

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An important reform would be to make sure that before any agency produces a new regulation, the following questions are asked and answered:

1. Is there a large, systemic problem that is unlikely to resolve itself in the near future?

2. Is the federal government in the best position to solve this problem?

3. Does the regulation actually address the identified systemic problem?

4. What other solutions are available?

5. Would the proposed solution give rise to other significant problems?

6. Would the preferred solution solve the problem at a reasonable cost?

7. Will the agencies be able to recognize when the problem is actually solved and eliminate the regulation when it becomes obsolete?

Veronique de Rugy

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