The new HARP might help...

From this morning's New York Times:

The Federal Housing Finance Agency, which oversees mortgage finance giants Fannie Mae and Freddie Mac, said it was easing the terms of the two-year-old Home Affordable Refinance Program, which helps borrowers who have been making mortgage payments on time but have not been able to refinance as home values have dropped...

...To encourage banks to participate in the program, FHFA is revamping it to protect lenders from having to buy back HARP loans if underwriting problems are later found. Banks will only have to verify that borrowers have made at least six of their last mortgage payments and the new rules eliminate the need for appraisals in most cases.FHFA said government-controlled Fannie Mae and Freddie Mac will waive certain fees for borrowers that refinance into loans with a shorter term, such as 15 years, aiming to spur homeowners to pay down the amount they owe at a faster rate.

The elimination of the requirement for an appraisal will make a big difference.  So will the waiver of fees for those who shorten terms.  Lower interest rates and shorter terms will help borrowers get right-side up faster.

Unpermitted square footage and your lender

If you've been searching for real estate in Los Angeles and San Fernando Valley, you already know that many homes have been added on to since they were originally built.  Some of the additions are really nice and make a lot of sense; others are really funky.  Some are permitted; some are not (back in the day, a lot of do-it-yourselfers didn't bother to pull permits.  It would have increased their property taxes to do so.)  And this usually becomes a freak-out issue for most buyers.  Here are some things to know.

Here's what your lender is concerned about vis-a-vis unpermitted square footage.  Caveat: this has nothing to do with what the city or your insurance company thinks about unpermitted square footage.  That's another thing entirely. Your lender, through the property appraisal, will be concerned with:

• The addition must be done in a workman-like manner with decent construction standards. Nothing with cinderblock bricks instead of a foundation, for example.
• It can't have a kitchen.  This is a big no-no for most municipalities, too.
• The addition's square footage will not be counted towards the square footage of the house.  You can't say your house is 400 sf bigger because somebody drywalled the garage.
• There must be comparable or similar additions, permitted or not, in the neighborhood.  For example, if the homes on your street were built with carports instead of garages, but subsequently everyone enclosed their carport, it's probably okay with your lender.

How do you tell if the square footage is permitted? Two ways.  You can either visit the city building and safety department and pull the permits on the house.  Or contact Permitreport.com.  Or you can look at the County Assessor's tax records (easy to find online).  Sometimes, though, for whatever reason, all square footage hasn't been recorded by the tax assessor; if there's a dispute, definitely go to the municipality.  In another post, I'll go into what unpermitted additions are probably NOT okay.

Type I error, Type II error, and voting

No matter how our registration laws are set up, we will make errors: either people who are eligible to vote will be prevented from doing so, or people who are not eligible to vote will be allowed to do so.  Type I error falsely rejects a null hypothesis, while Type II error falsely fails to reject a null hypothesis.

If the null is that people who should be eligible to vote should be allowed to vote, then the new voter registration laws  being propagated around the country will produce more Type I error.  Two points here--I suspect that the new laws will create a lot more Type I error than precent Type II error.  Also, to me, Type I error is more serious than Type II error--preventing eligible voters from voting is a more egregious error than  allowing ineligible voters to vote.

Weekend Tidbit Two: Donald Trump

SELLER: Donald Trump and Melania Knauss
LOCATION: Rancho Palos Verdes, CA
PRICE: $7,150,000
SIZE: 11,000 square feet (approximately), 5 bedrooms, 9 bathrooms

YOUR MAMAS NOTES: We may be a little late to grab the celebrity real estate brass ring on this one but how can Your Mama resist the opportunity to briefly discussion the opulent (but arguably banal) Rancho Palos Verdes, CA (mc)mansion that brassy and sassy billionaire real estate developer Donald Trump and his former supermodel wife Melania Knauss recently unloaded for $7,150,000.

While seven and some million is a high price to pay for a house by any standard, Mister Trump first listed the squat mock-Med manse back in June 2010 with an asking price of $12,000,000. A few flicks of the well worn beads on Your Mama's bejeweled abacus shows the buyer–an as yet unnamed owner of an obviously successful shipping concern–negotiated a rather stunning 40% discount from the original asking price.

The recently completed residence, situated in a small enclave of home sites adjacent to the Trump National Golf Course in Rancho Palos Verdes, CA, was custom built by Mister Trump on a short cul-de-sac where there does not currently appear to be any other homes built. That means, natch, the new owners of ex-Casa Trump will be inundated with construction noise and dust once the economy picks up enough enough that the sorts of people with the desire and dough to live in a Donald Trump-designed enclave in Rancho Palos Verdes start spending big to buy vacant lots on which to build ocean view (mc)mansions filled to the gills with wine cellars, panic rooms, private pilates studios, and studio apartment-sized walk-in closets and dressing rooms.

Listing information for the former Trump property shows the Italianate-ish mansion was built in 2010, measures around 11,000 square feet and includes 5 bedrooms and 9 bathrooms. A walled and gated courtyard entry leads to a columned portico where the front door opens into a marble-floored entry.

The marble floors–sandy beige with mud brown marble inset border–continues into the step-down formal living and dining areas separated by a quartet of stone Tuscan-style columns. Both spaces open through large sliding doors to the courtyard around which the rear of the house wraps. A library/office space has built-in bookshelves, narrow arched windows, raised corner fireplace with marble chimney breast and a black lacquer and gold kidney-bean shaped desk and a swiveling office chair upholstered in gold tufted leather.

The capacious kitchen has marble floors, an hippo-sized octagonal center island with vegetable sink, dark raised panel cabinetry (that may or may not be mahogany), and a spectacular copper exhaust hood over the commercial sized and styled range. An angled snack counter separates the kitchen from a breakfast area with ocean view and a family room with dark wood floors, fireplace, and multiple French doors plus a bank of sliding glass doors that join the room to a pergola-shaded dining terrace that overlooks the swimming pool, back yard and Pacific Ocean.

The mansion's lower level–"flooded w/ natural light" as per listing information–offers garage parking for up to four cars, a game room with wood floors, fireplace and saloon-sized booze bar, a glassed-in temperature-controlled wine cellar, and shower rooms for rinsing off the chlorine, sand and salt.

The wide stone terraces that extend off the back of the house tumble down to a golf-course green expanse of grass that stretches out towards the bluff that tumbles precariously and dramatically down to the roiling surf. There does not appear to be direct access to the beach from the property short of a person just flinging themselves over and down the cliff-like bluff.

More listing photographs, if any of y'all dare and can bear them, can be seen over on Curbed.

Although Trump National Golf Course is next door, a fact that makes the location of this mansion convenient, he reportedly maintains a residence up the coast in Beverly Hills, CA where he will shack up when on the west coast. Iffin Your Mama is being honest–and we always are–we'd freely confess we know zip, zilch and nada about said residence in Bev Hills.

What we do know based on intel provided by Our Fairy Godmother in Beverly Hills is that in July 2008 Mister Trump paid $10,350,000 for a 10,442 square foot center hall Colonial across the street and around the corner from the Beverly Hills Hotel. A year to the day later–as per Redfin–the property popped up on to the open market with an asking price of $12,000,000. Twenty seven days later–again as per Redfin–the 6 bedroom and 6.5 bathroom mansion was sold to a corporate entity for $9,500,000.

listing photos: Keller Williams Realty