Category Archives: Bedford Corners NY

BofA mortgage workforce swells even as it tightens belt | Bedford NY Real Estate

The Bank of America Corp unit that handles troubled home loans has grown more than tenfold since the bank bought ailing mortgage lender Countrywide Financial in 2008, documents obtained by Reuters show, shining new light on the scale of the clean-up the purchase entailed.

While most attention has focused on the No. 2 U.S. bank’s $35 billion in mortgage losses stemming from settlements and repurchases of soured home loans, information the bank provided to the Federal Reserve in 2008 and recent company reports show the mortgage mess could undermine efforts to improve profits for some time to come.

Bank of America now employs some 42,000 people – or nearly 1 in 6 of its 275,000 employees – in Legacy Asset Servicing, the unit that services problem mortgages. Operating costs in the mortgage servicing business reached $2.7 billion in the second quarter, up 29 percent from a year ago, as the bank added 7,000 workers to handle foreclosure reviews and loan modifications required under government settlements.

The bank has also had as many as 16,000 additional contractors working in the unit, according to company reports.

In 2008, as Bank of America was seeking regulatory approval for the Countrywide deal, it told the Fed the two companies had a combined 3,900 employees working on “housing retention,” a number that had already doubled in the previous year, according to the documents, which were obtained by Reuters through a Freedom of Information request.

That is not a direct comparison to the 42,000 full-time employees in the mortgage servicing unit now, as it has been restructured over time to include servicing for borrowers who have not defaulted. But default servicing is the largest team within the group, and its overall staffing levels are a good proxy to show how much the bank has had to ramp up to deal with the mess.

The hiring has come as the bank has set out to eliminate 30,000 consumer banking and technology jobs under a program called Project New BAC to cut $8 billion in annual expenses by the middle of 2015. It means that while 20,000 jobs have been eliminated in the past year, the overall headcount is down by only 13,000.

Despite the hiring and spending, Bank of America recently ranked last among five big lenders in modifying mortgages. Like some of its peers, borrowers and consumer advocates have repeatedly accused the bank of losing borrower paperwork, speeding up foreclosures and giving homeowners the runaround when they try to get their loan payments reduced.

Reining in these cleanup costs will be critical to financial performance over the next couple of years, as the bank retools to offset reductions in revenue due to new regulations, a tepid economy and low interest rates.

The $2.7 billion in operating expenses equaled 15 percent of Bank of America’s noninterest expense in the second quarter. It is also more than five times as high as the $500 million per quarter that CEO Brian Moynihan has projected the bank could spend on servicing in times of more normal delinquencies. The figure doesn’t include mortgage-related litigation expenses.

“This is perhaps the biggest earnings lever they have,” said KBW analyst Jefferson Harralson.

Investors will get an update on its costs when the bank reports third-quarter earnings on Oct 17. It is likely to post a small loss after reaching a $2.4 billion settlement of allegations that it failed to disclose bonus payments and ballooning losses ahead of its 2009 Merrill Lynch acquisition, according to a survey of analysts by Thomson Reuters I/B/E/S.

Bank of America spokesman Dan Frahm said the bank has invested heavily in its Legacy Asset Servicing unit to assist customers, boost the housing market and help the company move forward after the Countrywide acquisition.

“We will not sacrifice service to our customers in need of assistance,” Frahm said, adding that the team has helped more than 1.4 million mortgage customers avoid foreclosure.

“As the economy improves and we continue to resolve customer needs, we will further reduce the number of delinquent loans to service and the size of the Legacy Asset Servicing organization will be reduced,” he said.

The unit was designed as a “temporary solution to address specific needs” and was built up using contractors and vendors so the bank could eventually reduce it in size, he said.

‘TOO EARLY TO SCALE BACK’

For now, though, the bank is struggling to bring the problem under control.

Moynihan said in October 2011 that mortgage servicing had peaked, but expenses have climbed since then. In May, he told investors the costs should start coming down in the second half of this year, but then in July he said “meaningful” improvement would not begin until the end of this year or early in 2013.

Last month, Chief Financial Officer Bruce Thompson said at an investor conference that lower costs for servicing are “going to be very much in the future.”

The bank has underestimated the extent of problems at the business in the past, the Fed documents show.

In May 2008, the bank said it planned to maintain the “historically high staffing levels” for at least a year after the deal closed, according to the documents.

Despite ramping up staffing, Bank of America has fallen behind rivals in meeting terms of a $25 billion pact finalized in April with state and federal officials.

As of June 30, the bank had not modified any first-lien mortgages under the national mortgage settlement, according to a report issued by monitor Joseph Smith. The other four lenders in the settlement had completed some modifications.

The agreement requires banks to pay penalties over foreclosure-related errors, modify mortgages by reducing principal owed and refinance loans for customers whose mortgages are worth more than their homes. Bank of America owes the most: $11.8 billion in payments and consumer assistance.

Bank of America has called Smith’s report an “early snapshot” and has said it has made significant progress since June 30, completing nearly $600 million in loan modification as of August 21. The bank has said it plans to meet conditions of the settlement.

“It’s clearly too early to scale back because they haven’t even scaled up to meet all of the obligations that have been imposed on them,” said Stella Adams, director of the National Fair Housing Training Academy, which provides fair housing and civil rights training to government agencies, industry officials and others.

via reuters.com

Future of old NY amusement park to be discussed | Bedford Corners Real Estate

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Drastic changes may be in store for Playland, the landmarked, county-owned amusement park just north of New York City.
Westchester County Executive Robert Astorino says he will have a major announcement Thursday about the park’s future.
Astorino has complained that Playland is losing more money than taxpayers should have to cover. He said last year that closing the park could save $2 million a year. He invited developers to propose ways to “reinvent” the park.
A citizens’ committee reviewed the proposals and submitted a report to Astorino a year ago.
Playland, a National Historic Landmark in Rye, opened in 1928 and was featured in the 1988 Tom Hanks film “Big.” Among its famous old rides are the wooden “Dragon” roller coaster and a high-speed carousel.

via online.wsj.com

7 musts for maintaining a redwood deck | Bedford Hills Realtor

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Q: My redwood deck is about 2 years old and needs a good cleaning. Which product would you recommend to clean a redwood deck and what sealant should I use? I like a clear, natural finish.
A: You’re right at the outside edge there. If a redwood deck gets a fair amount of sun, it should be cleaned and resealed at least every second year. If it’s mainly shaded and you haven’t developed mildew, you can get by with doing it every three years. Cleaning and sealing should be viewed as a regular maintenance program and will prolong the life of the deck as well as maintain its look.
Although we’ve addressed this subject many times, a quick refresher course is in order.
For longevity and aesthetics, apply a preservative to outdoor wood. It can either be semitransparent stain or clear preservative. While stain will change the color of the wood, a clear preservative will darken and enrich its natural color. An example is redwood, which is a light red, almost pinkish color in its freshly milled state but turns to a deep red rose when treated with most preservatives.
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Many companies make sealants and stains for outdoor wood. Some of the better-known brands are Cabot, TWP, Defy and Armstrong. For a clear finish, our favorite has always been DuckBack’s Superdeck, a sealer that offers protection from the sun’s ultraviolet (UV) rays. But we recommend you do your own research by going to deckstainhelp.com and clicking on “product reviews.”
Frequency of sealing depends on exposure to weather and use. A maintenance program consists of cleaning the deck, removing any mildew, and applying a new coat of preservative.
Although we continue to believe that the best way to clean a deck is with a pressure washer, a stiff-bristle brush and plenty of elbow grease will do the job, especially if cleaning is done regularly. Think about going to the dentist to have your teeth cleaned. The job is a lot easier and less painful if it’s done at regular intervals.
A pressure washer sends out a pressurized fan of water that makes short work of surface dirt, mold and mildew. These machines are available at rental centers and can be purchased at home centers. If you get along well with your neighbors, consider getting two or three of them to chip in on buying one and then sharing it.
We recommend using a pressure washer that can produce a stream of water of at least 1,500 pounds per square inch (psi). Be sure to keep the wand moving so you don’t blast softer wood away from the surface and leave a rippled effect on the deck. Deck cleaners formulated for use with pressure washers are available where the machines are rented or sold.
If you go the brush route, use a stiff-bristle brush and deck cleaner mixed in a bucket of water in the proportions the manufacturer recommends. Use a brush attached to a broom handle to save wear and tear on the back and knees.
In shaded, moist areas, mildew can be a problem. Wash with a weak bleach solution — 1/4 cup of bleach to a gallon of water — to kill the fungus before pressure washing or scrubbing.
Once cleaning is completed, thoroughly rinse the deck with clear water and allow the deck to dry for several days. Then brush, roll or spray a coat of UV protective water-repellent sealer or stain. We found some excellent “how to” videos on the Superdeck website.
So, to sum up:
Pressure wash your deck rather than sanding it.
Clean and treat your deck with a preservative every two years.
Remove any mildew by pressure washing thoroughly.
Use a pressure washer with at least 1,500 psi.
Use the fan setting on the nozzle and keep it moving to prevent a ripple effect.
Use a chemical deck cleaner for really bad decks.
Apply sealer or stain.

via inman.com

Think twice before charging for waterfront access | Bedford NY Realtor

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Many fishermen cut through private property to reach their favorite section of a river. Often, that entry can be illegal trespassing, but there are many places where access is granted and encouraged.
For example, there is a private property owner on a river who for years had a deposit box on a cleared acre of land, a pie-shaped parcel whose “point” was a makeshift boat launch. “Honor system” steel headers crammed coins into the slots of a metal box for the right to use the launch and park their trucks and trailers. The name of the fishing hole opposite the launch got its name from the size of coin that fit the slots in the metal box.
Several years ago, when there was an accident on the launch involving a teenager, I thought about the liability, not only to that parcel but to other properties adjacent to natural bodies of water, such as riverfront restaurants, Puget Sound marina docks and city beaches.
Most states now have guidelines as to how business and rental property owners treat and protect their waterfront, especially when children are present. In summary, these owners are required to make “reasonable” efforts to protect children on their property and from natural bodies of water.
One of the challenges is the definition of “reasonable.” There is no written rule that says that a property owner must fence off a body of water in order to avoid potential liability. And reasonable care applies only to a property owner who derives some economic gain from the children’s presence. A private homeowner has no such duty to protect children who are social guests from the dangers of natural bodies of water.
The reasons for the precautions stem from a terrible case where a 2-year-old child was left a quadriplegic with brain damage after nearly drowning in a creek at a mobile home park. The boys’ parents paid rent for a mobile home space there, plus an additional $1 a day for each of their five children.
According to court documents, there is a clear, shallow, slow-moving creek in summer that can be deep, swift and murky during the winter months. The landlord required families with small children to live at the far end of the park, away from the families without children and in the area closest to the creek.
Although the mobile home park was partially fenced, there was no fence running along the property nearest a grassy play area adjacent to a steep embankment leading to the creek. The parents did not allow their young children to play outside alone and did not allow them to go near the creek by themselves.
The boy was riding a bicycle while the father was making repairs on their home. According to the father, the boy was out of his sight “for less than one minute.” The father found the bicycle at the bottom of the embankment, partially submerged in the creek. A neighbor helping to search for the child eventually found the boy in the creek.
The father and boy, through his guardian, sued the mobile home park for negligence. The trial court ruled that a landowner’s duty to maintain the premises in a reasonably safe condition does not require affirmative acts to protect tenants from the inherent dangers of natural bodies of water.
The father and boy appealed and the high court reversed the trial court’s decision. The case eventually was settled for the full amount of a $500,000 insurance policy.
Generally, a landowner owes a trespasser or a “licensee” only a duty to refrain from “willfully or wantonly” injuring them. A licensee is someone who enters upon the land with the landowner’s consent.
An exception to this rule is the attractive nuisance doctrine. This doctrine, the result of concern for kids who trespass on property to use an attractive and sometimes dangerous element (such as a pond), elevates the standard of care and states the landowner is liable if the danger is not eliminated. However, this does not apply where the hazardous condition is a natural body of water.
According to attorneys familiar with the case, the decision means there is no exception for natural bodies of water where the landlord gets cash from the users. Again, a private homeowner has no such duty to protect children who are social guests from the dangers of natural bodies of water.
However, if you charge to reach the waterfront, make certain you have ample insurance in place.

via inman.com

You’re chasing connections, but consumers value information | Bedford Corners Realtor

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I recently had the good fortune to hear Jeffrey Cohen, manager of content marketing at Salesforce’s Radian 6 Marketing Cloud, when we were both keynoting at the Social Media Strategies Summit. His presentation was solid and leaned heavily not just on data, but real data from real sources he was able to cite. This is all too rare in social media presenters.
I, of course, loved it. So when he mentioned via Twitter some recent LinkedIn changes, I took notice.
It wasn’t just the promise of learning about some new features of a digital tool that got me though. It was his assertion that the LinkedIn changes represented “another step toward information over connections.”
Hold that thought for a moment. Before looking at what this means for your real estate business, we’re going to explore how the emergence of new technology platforms complicates the task of gaining direct access to customers, and locking them in.
Stability versus direct access
In technology and maybe other aspects of life, there is a constant layering of ideas, services and products one on top of the other in a mad race to maintain a combination of stable business and direct access to the customer.
These two things — stable businesses and direct access to the customer — are probably diametrically opposed. A stable business usually would require a minimum of changes and variables leading to a high degree of predictability. Customers, on the other hand, are pretty much the definition of mercurial change and unpredictability.
For technology companies, stability often comes in the form of controlling access to a deep layer of technology. We see this in the form of vendor lock-in, for example. Lock-in can be overt, as in the requirement to use proprietary software and hardware. Lock-in can be subtle, as is the case with services that have a high “switching cost.”
To maintain the stability, the technology company needs to provide something of value that overcomes whatever lock-in is being applied.
Direct access to the customer, on the other hand, can come from following taste and fashion. Businesses and organizations that are serious about succeeding tend to foster the ability to listen and observe human behavior in order to stay ahead of the taste/fashion curve. This sort of observation leads to developing new tools and services that maintains their direct access to customers.
So we end up with a constant interplay between chasing direct access and locking it down for stability.
At a high level we can see this in the history of computing itself over the past 30 years. First there was the operating system. There was wide variation in the software, which talked directly with the hardware. A great deal of competition occurred on this theme and then settled out to being primarily Microsoft Windows, with a smattering of other also-rans.
But just as that stability was being locked in by Microsoft, the World Wide Web started capturing the attention of customers. The race was on once again, with the browser wars that began in the late 1990s. Those of us who cut our teeth coding for the Web in this era are all too familiar with the lock-in shenanigans of technology companies during this era (the remnants of which still linger more than 10 years later, in the Cro-Magnon, Explorer-only Web interfaces often employed on the backend of many multiple listing services).
With the rise of the Web, customer access at the operating system level became less important. There was less ability to lock-in customers. The effect of this is to turn much of what made for an effective operating system business into an anchor. Stability is great until there’s too much stability. Paralysis is a form of stability that isn’t desirable.
In the past five years we’ve begun to experience the rise of the social Web. Instead of the wide-open Web, customer interest and activity is tending to focus in on the sorts of things offered by social networks.
In the same way that the World Wide Web layered itself on top of the platform of the operating system, the social Web is layering itself on top of the Web. None of the lower levels of the platforms go away. They are still around in the same way that live theater continues to exist even though we have movies (or the way movie theaters are still around even though we have Netflix). Still present, but less important. The deeper levels have more stability but less direct access to customers.
In the past three years we’ve seen this layering occur in the mobile phone business. The rise of smartphones layering on top of the platform of carrier stability.
Currently we’re beginning to see a layering of data businesses over other types of businesses. Which brings me back to Jeffrey Cohen’s “information over connections.”
Information over connections
For platforms to emerge and gain enough direct customer access to apply some sort of lock-in, they typically will address some unserved need.
The current ascendent technology platform — the social Web — is focused on connections. There are friend counts and follower counts. A tithe of pixels on many websites implores people to add some sort of additional connection.
Why do we want to increase connections? As people, we want a variety of kinds of information.
Some of it is basic emotional stuff: I want people to like me, I want to fit in, I want to be part of a group so I don’t feel so alone in the world.
Some of it is more utilitarian stuff: I want to know how to accomplish a certain task; I want to hear about various options; I want to know more about the world I live in.
The point here is that “connection” is the platform layer that is currently ascendent or dominant just like the operating system once was. The thing that flows to (and from) us via connection is information.
Perhaps, in the same way that the Web was layered over the operating system, we will see a layering of information over connection.
Implications for real estate
For the people who have made it this far, through the history of technology layers and abstractness of connections and information, let’s see if we can’t tease out some direct and specific thoughts for the real estate business. For fun and enjoyment, I’ll present them as koans in bullet list form:
If a brokerage currently thrives due to a large volume of agent connections, will this help or hinder in an environment where information is more valued?
Will an agent who thrives due to large investments in emotional connections thrive in a world where information moves quickly?
Are the needs of real estate consumers more readily met with connection or information?
Given the current state of interbrokerage agreements, how much lock-in is available in a high-information environment? How much customer access is granted?
Which groups thrive most in a high-information environment: aggregators, brokerages, agents, tech vendors, real estate consumers?
Which groups thrive most in a high-connection environment: aggregators, brokerages, agents, tech vendors, real estate consumers?
Are any industries operating in a post-connection environment? Are any geographies more likely to be operating in a post-connection environment?