By JIM and ELIZABETH STEIN, JAE WU and SEAN McMILLAN With the mortgage market in turmoil, one question that real estate agents in Pacific Palisades are hearing is ‘How will the Palisades market be influenced by the current foreclosures?’ We feel that a somewhat minor local influence can be expected as a result of this mortgage correction. Suffice it to say that lenders will continue to lend; the lending business is a $10-trillion industry that we believe is in a correction mode. Google ‘mortgage implode’ and you get a site that points you to the ‘Implode-o-meter’ which counts, as of Tuesday, 130 lenders in the U.S. that were forced to shut down operations. Some of these institutions were among the largest in the business. Seven large lenders remain in the business. So what does all this news mean to you and, most importantly, what should you be doing right now to make sure you are protected? Let’s first hear from mortgage brokers Jae Wu and Sean McMillan of First Financial Mortgage in Santa Monica, who are industry leaders in their field. Over the last few years, many loans were made to borrowers whose situations normally would not have allowed them to obtain financing. These borrowers did not qualify for Fannie Mae or Freddie Mac loans, so they got ‘nonconforming’ loans. These loans were called ‘sub-prime’ or ‘Alt-A’ loans. The money for these ‘nonconforming’ loans does not come from the government-sponsored entities of Fannie/Freddie but from private institutions and investors. In Westside markets, nonconforming loans are in the form of the jumbo loans that many people have employed to finance their home purchase. The increase in defaults and foreclosures are credited to the soft real estate market that is being experienced nationally and the credit tightening that a soft market normally creates. Compound the soft market with the exotic and low down payment financing that 42 percent of first-time buyers used in recent years to purchase their home–and you have a recipe for the fallout that has recently taken place. How does this affect us here in Pacific Palisades and neighboring markets up to this point? Locally, we are dealing with jumbo loan rates being significantly higher now than they were a few weeks ago (@ 7 ‘-7 ‘ percent). Additionally, there is a lack of liquidity in the market because of private institutions and investors who have ceased entirely the purchase of mortgage-backed securities. No financial institution/private investor purchase of mortgage-backed securities, no money to lend to nonconforming loan borrowers. This all amounts to a readjustment that is taking place where lenders are reviewing files with a much more cautious eye than in the recent past and are taking much longer to review a borrower’s profile than before. What the lenders will be looking for now is the ability of the borrower to repay even in times of extreme distress. Can that person pay on their loan or have the ability to sell if they have to, and is there enough ‘equity’ in the home? For those of you who have a mortgage, this market is not going to affect you on your current mortgages. The people this crisis is affecting are those who are selling right now and those who want to purchase a home. If you are a potential buyer, you are going to be scrutinized more than ever before. The main thing you should do is make sure that your credit has been carefully reviewed by you or your mortgage professional. Your great credit is one of the main features that will differentiate you in whether you get a good loan or not. Make sure you can document the income you earn and be sure to document where your down payment is coming from. As a seller, you are going to have to be flexible with your buyer as they work in this climate. Work with a loan broker who is prepared to complete your file in the strongest way possible so that your loan gets funded as quickly as possible. If you would like to discuss this article or any other questions you may have, please call or write to Jae Wu or Sean McMillan at team@wumac.com or (310) 234-3278. +++++++++++++++++++++++ Now for the current real estate market from leading Pacific Palisades agents Elizabeth and Jim Stein with Prudential California Realty. How will the local housing market react to this mortgage market and what can you do to navigate in this climate if you are considering buying or selling? We believe that this mortgage market will have an impact on the mindsets of our buyers and sellers more than how it will actually play out in the form of price decreases in this area. The media is running with this topic every day and is creating fear in those considering a real estate transaction now. The fear created in the press, we believe, will be worse than our local reality. With this mortgage market correction, we will have to navigate through a tricky terrain. A few suggestions for those considering buying and/or selling now: – If you are a buyer, be prepared with proof of your great credit rating and proof of funds when you go in with an offer. One current shift that we have experienced is lenders are taking longer to get loan packages done. The lenders are, as promised, reviewing a borrower’s financial status with a much more careful eye. By offering your credit rating and proof of funds up front, you give a seller additional comfort in your overall profile and ability to close on time even with this existing mortgage market challenge. – Additionally, as a buyer, it is critical that when you get a loan lock, get it in writing and most importantly, confirm that the lock is good through to the end of the escrow period. We have heard of loan documents being signed and lenders refusing to fund, citing the disappearance of the loan program previously offered. – If you are a buyer, a ‘must’ right now is to do double loan applications. This means to apply with two mortgage brokers so that if a loan program or rate is discontinued, you can still work with the other broker to close your escrow. – If you are a seller, work closely with your real estate agent to understand and anticipate your buyer’s needs and how they might change due to lenders’ demands. Consider carrying a second trust deed for your buyer. This will lower their loan-to-value ratio and should assist them in getting financing faster and more easily. Also, you can consider buying down points on your buyer’s loan. This allows your buyer to afford more in the purchase price of your home. – As a seller you can request that the earnest money deposit be released from escrow upon the removal of contingencies. This is an added measure of security that the buyer plans to close escrow on time and as offered in the contract. If you would like to discuss this article or for any other questions you may have, please e-mail steingroup@prula.com or call Jim Stein at (310) 230-3769 or Elizabeth Stein at (310) 230-3712. For much more on this topic of mortgages, local real estate and how to best position yourself in this market, there will be a free evening conference on September 17 at the Palisades Branch Library on Alma Real from 7 to 8 p.m.

More than 900 residents and guests watched ‘Ferris Bueller’s Day Off’ at the Palisades Recreation Center Saturday evening. ‘I was amazed that after the movie started, people just kept coming and coming,’ said Arnie Wishnick, executive director of the Chamber of Commerce, which co-hosts the August screenings with the nonprofit Movies in the Park committee. As a special treat, two of the actresses from the movie, Palisadian Cindy Pickett and Edie McClurg, spoke about making the movie. ‘While we were waiting for them to set up the cameras and lights in the Bueller house, there was a pool table in the basement and we went down and played,’ said Pickett, who played Ferris’ mother. ‘We got quite good.’ Pickett also confessed that she met her husband, Lyman Ward, who played her onscreen husband, Tom Bueller, in the 1986 comedy. The couple had two children, but have since divorced. McClurg, who is hilarious as the school secretary, said that when she showed up on the set with a bubble hairdo, director John Hughes asked her how many pencils she thought she could get in her hair at one time. It turns out that three was the maximum, as evidenced by a scene in the movie. In addition to the two actors, the second assistant director on the movie, Ken Collins, also attended the Palisades screening. ‘We shot the first half of the movie in Chicago,’ he recalled, ‘and the other half in Los Angeles.’ When the crew moved back to L.A., the remaining high school scenes were shot at El Camino High School. ‘The kids in Chicago were white and pudgy,’ Collins said, ‘and the kids in California were thin and tan and looked like they were actors.’ Collins lives in Larchmont and came because of Pickett, who he has directed in ‘Without a Trace.’ ‘I consider the parade scene [in Ferris Bueller] to be one of the highlights of my career,’ Collins said. ‘It was the greatest feeling seeing it on-screen.’ The three said they were thrilled that the film is ranked number 10 on Entertainment Weekly’s ‘Top 50 Best High School Movies’ and continues to be a cult classic. This year’s Movies in the Park series will conclude on Saturday at 8 p.m. with ‘Indiana Jones and the Last Crusade,’ the highest grossing movie of 1989. Directed by Palisades resident Steven Spielberg, the film stars Harrison Ford and Sean Connery. Admission is free, but attendees are reminded: no alcohol, no stick chairs and NO DOGS. One of the conditions of obtaining permission to show films on the Field of Dreams at the Palisades Recreation Center was that no dogs would be allowed.

The Pacific Palisades Community Council’s Marquez Transportation committee has contacted Marquez Charter Elementary Principal Phillip Hollis and asked to attend the next governing board meeting in September to discuss school-related traffic and parking issues. At its August 9 meeting, the Community Council voted unanimously to send a letter to L.A. School Board member Marlene Canter, arguing that ‘more than 500 cars stop at Marquez Elementary every school day. The school population has gone from roughly 500 to close to 800. The school has only 25 on-site parking spaces. This is unsatisfactory, as the staff is closer to 100.’ The council approved sending the letter, which suggested four solutions (including a recommendation that one-third of the Marquez playground be turned into a parking lot) after they were assured that the principal and the school had approved it, which was not the case. This week, the Palisadian-Post checked the numbers cited in the letter. In the faculty parking lot there are 30 numbered spaces, an additional curbside spot and a handicapped spot, bringing the total to 32 spaces. This year’s faculty number is 32, plus 25 aides and five office personnel. According to Principal Phillip Hollis, the number of projected students for this school year is 598, not ‘close to 800.’ And the 500 cars arriving at the school every day? Maybe not in the morning or in the afternoon. This spring, an official of the L.A. Department of Transportation Crossing Guard Section counted cars and children at the intersection of Marquez Avenue and Edgar Street, but found the numbers too low to warrant a crossing guard. In order to qualify, a minimum of 300 cars and 20 walking children must go through the intersection in one hour, according to Sergeant Juanita Wildy. Hollis, who has been seeking a crossing guard, has asked for a recount. John Grosse, a member of the council’s Marquez committee, has suggested that additional faculty parking could be built on the playground next to the dismissal gate and near the kindergarten bungalows. This would mean relocating the kindergarten/first-grade play structure, as well as moving two basketball courts and a handball court. If cars were routed to the far end of the playground, trees and part of the grass yard would have to be removed. This week, Hollis suggested that an ideal place for additional parking would be at the intersection of Ida Street and Marquez Avenue, but the school does not have the funds for such construction. Hollis is also concerned that there are no sidewalks for children to walk safely to school on adjoining streets, which could help alleviate some vehicle traffic.

Achievement scores at Palisades Charter High School surged this last school year, according to data released by the state’s Department of Education last week. Students made gains’sometimes at double-digit rates’across all subjects, raising the 2,700-student school above many of the state averages that it had trailed during the last several school years. ‘I was very impressed by the gains, particularly in the ninth grade,’ said new Principal Marcia Haskin, who spent Tuesday poring over the data with the school’s Data Coordinator John Rauschuber. ‘There was also remarkable progress in math. The results were astonishing compared to state results. It shows how the attention to ninth grade can really help.’ After examining the results, PaliHi Board Member Eileen Savage said that the data validate teachers’ efforts in the past year. ‘Teachers have to pat themselves on the back. They deserve applause for really focusing on making those gains. It’s a credit to placing students in the right classes and to teachers who are teaching students state standards.’ Each spring, all public school students between the second and eleventh grades take California Standards Tests (CSTs), which rate student achievement on math, science, English language arts and history. Tests are intended to correspond with students’ curricula. Scores are divided into five levels (listed in decreasing order): advanced, proficient, basic, below basic and far below basic. State educators set ‘proficiency’ as the minimum target for all students. The biggest gains were largely confined to ninth-grade students, who saw double-digit increases in the percentage of students considered proficient or advanced in the 2006-7 over the 2005-6 school year. The subjects that saw the largest improvements include Algebra I, CST Math (based on sixth- and seventh-grade standards), geometry and CST English. For example, 46 percent more students were considered proficient in Algebra I, raising proficiency to 69 percent of ninth-graders. Thirty-one percent of students are considered proficient in CST Math (which is based on sixth- and seventh-grade standards), a 17-percent increase over the previous year. Students in 10th and 11th grades saw little of the same progress made by their ninth-grade counterparts. Tenth-graders taking CST Science and chemistry fared worse than the previous year; the number of proficient students in that grade stayed the same or barely improved as measured by English, biology and geometry tests. School officials attributed ninth-grade gains to a host of programs called the Pyramid of Interventions, which target some of the poorest-performing students. Students entering the school from eighth grade with at least one grade of ‘C’ or lower are placed into a mandatory guided-study class. Students who fail a class at Pali must attend mandatory tutoring or’in the case of Algebra I, for example’repeat the subject. In 2005-6, only 17 percent of ninth-grade students tested proficient in that entry-level math class. But during the most recent school year, students who failed the first semester had to retake a class specifically designed to teach failing algebra students the lessons that they missed. The results: 69 percent of the ninth-grade class in 2006-7 was proficient. ‘We’re catching kids who are struggling earlier,’ Executive Director Amy Held told the Palisadian-Post. ‘And we’re tracking kids who are failing.’ School officials also ascribe the improvements to a new focus on ‘data-driven’ instruction. Last year alone, PaliHi collected and analyzed 17,869 standardized tests from the school. That figure is up 52 percent from the previous year. ‘Data is driving the school,’ said Rauschuber, a government teacher who also heads data collection and interpretation at the school. ‘We use data to guide teaching decisions and to evaluate teaching methods.’ Beginning in 2005, teachers began forming Project Learning Communities (PLCs). Teachers who teach the same courses create common tests that reflect statewide standards. Held and Rauschuber credit these PLCs with creating new data by which to study student progress and also refine teaching. ‘Teachers [are] asking how these students perform? And how can we teach this better?’ Held said. Despite the school’s large gains, this year’s data show a consistent achievement divide: students at Palisades High fare significantly better in English and history than they do in math and science. In fact, fewer 10th-graders taking Algebra 2 were proficient than at the average state high school. The same was true for 11th-graders taking chemistry. As reported in the Post, the school’s relative weakness in math and science meant a 10-percent drop in state rankings last April, when the state increased the value of science and math when calculating state rank. Results of the CSTs are the most heavily weighted data that combine to make the Academic Performance Index (API), which is used as a broad measure of school performance. In 2006, Pali’s Base API was 766. The Education Department has set 800 as a statewide goal for all schools. The school’s Growth API, which will use the results of the most recent CST scores, will not be available until August 31. Rauschuber said that based on his analysis of CST data he would be ‘astonished if the school-wide API didn’t increase.’ Upon releasing the CST results last week, State Superintendent of Instruction Jack O’Connell highlighted the large achievement gap between white and Asian students and their Latino and African-American counterparts. The Post will analyze that gap when the most recent API scores are released. —– To contact Staff Writer Max Taves, e-mail reporter@palipost.com or call (310) 454-1321 ext. 28.

After a five-years-in-the-making attempt to complete a modest wish-list of repairs at its park in Rustic Canyon, the city will receive an additional $150,000 from the state. City officials hope to use that money to make repairs left incomplete by high costs and inefficient management. The $150,000, unlike previous funding, comes from Prop. 12, which is managed by the state’s Department of Parks and Recreation. Conditions of that bond money require that the work it finances must be complete by the end of December, wrote Council District 11 Deputy Andrea Epstein who announced the news last week in an e-mail. The city has prioritized the following repairs (listed in decreasing order): restructure the sub-floor of the ceramics room, which the city considers a ‘public health priority’; construct a staircase from the edge of the parking lot to the lower picnic area; reconstruct the outdoor patio area, where tree roots have upended tiles; extend the internal fencing of the tennis court to prevent balls from going court to court; and replace a section of the fence along Latimer Road with a vinyl coated fence. It is unclear whether $150,000 is enough to pay for all of these planned changes, but the city plans to do as many as possible with the money. City officials called the new funds a boon for beleaguered construction efforts there. ‘It’s a win-win for everyone,’ said Neil Drucker of the Bureau of Engineering, who oversees much of the repair in the city’s parks. Los Angeles City Councilman Bill Rosendahl, who is also chairman of the Public Works Committee, was decisive in helping the park receive the state funds, said Drucker. ‘Rustic Park is a beautiful place,’ Rosendahl told the Palisadian-Post on Wednesday. ‘Whatever we can do to make it a treasure for citizens, we’ll do. When we heard about the funding, we wanted to make sure it was available. It improves the quality of life of our constituents.’ A group of locals met for years as part of a Local Volunteer Neighborhood Oversight Committee (LVNOC), drafting their priorities for $500,000 of city bond money at the park. Among those priorities included installing an automatic irrigation system, resurfacing basketball courts, repairing the entry courtyard and replacing damaged tiles. But hundreds of thousands of dollars later, the only visible sign of the money was a handicapped-accessible public restroom, leaving all of the LVNOC’s priorities unaccomplished. Although still wary of city promises at the park, local residents considered the new funding a positive sign. ‘This is $150,000 we wouldn’t have had,’ said George Wolfberg, president of the Santa Monica Canyon Civic Association. ‘[City construction crews] are under the gun and they’re going to get moving on this–which is better than they’ve shown so far.’ Although construction will have to begin soon in order to qualify for the $150,000, city officials do not know when the LVNOC’s other priorities will be met. Last spring, the park was allocated $300,000 to complete its unmet goals. But construction there awaits a ‘reasonable’ bid from the city’s sole contractor, the General Services Department (GSD), said Drucker. He estimates that it will be one year before construction is fully complete. Drucker insists that many of the inefficiencies that have hobbled construction and inflated costs will not be repeated. ‘What we’re doing this time is we have a number of checks and balances,’ he said. ‘We’re going to closely watch the costs.’ —– To contact Staff Writer Max Taves, e-mail reporter@palipost.com or call (310) 454-1321 ext. 28.

A long-sought goal to fortify the Via de las Olas bluffs against dangerous erosion began last week, when City of L.A. workers began digging a trench that will house a massive new steel bulkhead there. But construction there hit an early snag this week. Workers with the city’s Department of Public Works’ Bureau of Street Services broke an 8-inch clay sewer pipe while they were verifying the locations of existing utilities and surveying holes to be drilled for the 59-ft. steel bulkhead piles, according to department Spokeswoman Lauren Skinner. Bureau of Sanitation crews responded ‘immediately’ to the break, but during the repair, the pipe leaked, Skinner said. As much as 600 gallons of sewage spilled, according to Gerald Watson, a district supervisor in the Wastewater Division of the Bureau of Sanitation, who managed crews that responded to the spill on Tuesday. The eight-inch sewer line must be re-routed before bulkhead piles or beams can be installed there, according to the department. ‘There is no adverse effect to the bulkhead project schedule or budget for re-routing the eight-inch sewer around the location of the interfering bulkhead pile,’ Skinner said. Completion of the project is expected by the end of December. As reported by the Post, the city rejected bids from private contractors last May, choosing instead to use in-house workers at the Bureau of Street Services (BSS). In June, engineers said that its forces were ‘able to construct these bulkheads quickly, cost effectively and with a high standard of quality.’ By Tuesday, BSS crews had dug a five-ft. deep trench that extends approximately a dozen feet beyond the current wooden bulkhead or retaining wall. Once complete, the new bulkhead will be buried underground, running 500 ft.’many times longer than the current bulkhead’and spanning six homes between 15251 and 15205 Via (between Lombard Avenue and Friends Street). The only improvements that will be visible above ground will be a new curb and gutter, asphalt patching adjacent to the curb and a new metal vehicular guardrail, according to engineers at Public Works. After nervously watching the edge of the bluffs move closer and closer to their houses for decades after winter storms, residents are relieved to see construction begin. ‘People are pleased that they are starting to take care of this,’ said Bill Moran, who lives at the corner of Via and Lombard. ‘But it’s 55 years in the making.’ In the 1950s, acres of the bluff collapsed under the strain of wet weather and the resulting landslide crossed Pacific Coast Highway onto the beach. Since then, residents have lobbied for better protection with few signs of progress until 2005–when an especially wet winter brought more land movement. That year, with the help of Congressman Henry Waxman, the Federal Emergency Management Administration (FEMA) awarded $2.6 million toward the $3.5-million project. The city and state are dividing the remaining cost. Although construction plans were approved by the city in 2006, work could not start until the delivery of 61 large steel piles last week from a single supplier in Arkansas. Piles vary in length between 59 and 60 feet, and each weighs more than 11,387 pounds. The storage of those piles, a large tractor and other construction equipment along the bluff has disquieted nearby residents, who worry that equipment and supplies will destabilize the already weak bluff. ‘[I am] thrilled that the project has begun but stunned that the heavy equipment and steel beams are stored on the bluff itself rather than the street,’ wrote Via resident Regina McConahay to a city official by e-mail. ‘This is just what the engineers advised us against doing’that is, allowing vehicles or any other weight off road.’ Said Moran: ‘My concern is whether or not that was a decision that was made by an engineer or the guy delivering [the beams] in the truck. They’re probably going to sit there for months.’ Public Works’ Skinner told the Post that those fears are not justified. ‘The location of the lay-down was made to minimize the impact to the local residents. The lay-down is to be used for a relatively short period in order to facilitate construction. We are in a period of relatively dry weather, when the stability of the area is not impacted by serious rainfall.’ —– To contact Staff Writer Max Taves, e-mail reporter@palipost.com or call (310) 454-1321 ext. 28.