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DAN'S PAPERS, December 19, 2008 Page 36 www.danshamptons.com

Gas

(continued from page 19)

trucks direct from their refineries. So the new law does not apply to them.� In other words, although the gas comes out of the ground everywhere the same, it depends where it goes before it gets to the pump. If it goes to a Mobil owned oil refinery and gets stamped MOBIL, then they can continue doing zone pricing. If it gets marked “generic� and gets bought by an independent wholesaler who ships it out to independent gas stations, then they can’t do zone pricing. In a strange way, this situation gives a big boost to the independent stations. When the word gets out that the gas you get there is cheaper, the old mom and pop owned stations, which often provide not only gas, but friendly repair service, will get lots more business. So hooray for the folks who own the B & L Service Station in North Sea and the Superior Gas Station in Aquebogue and PayLess Gas Station in East Hampton. If matters go that way, then soon the majors will have to lower their prices anyway to compete. On the other hand, because gas is gas and the cost by the barrel is the same, perhaps the lower price required for compliance will cause the mom and pops to be unable to make enough money to stay in business. One final thought. With the economy in the dumps, the Hamptons could get hit particularly hard since it centers on tourism and Wall Street. If this place goes even further into the dumps, perhaps the zone pricing will drop away anyway because the Hamptons will no longer be home for the rich. We shall see.

Estate

(continued from page 23)

during the short week of Thanksgiving, applications for refinance were triple what they were a year ago. But applications are still only one quarter what they were during what some people are calling the massive fraud era. So instead of new buying activity in the tundra of Hamptons home sales, the wealthiest of the wealthy are finding ways to maintain their mansions at record low rates. As it is, many of those well-heeled homeowners carry mortgages not because they have to, but to maximize income tax benefits. The unnamed source said, “We know who they are, we know they will pass with flying colors, so we are contacting them or their representatives and giving them a shout. It’s smart business.� Asked if this was affecting the amount of money available to first time homebuyers, the source gave a less definitive answer. “Money is always available to new home buyers, it is our business. But due diligence is making it tougher for people without proven track records of paying mortgages, and who aren’t really well financed in all aspects of their lives, to get homes than it is for the winners to refinance. So the good news is if you own over 30% equity in your home and your credit score is over 720, which is nearly perfect, then you are eligible for some refinancing at post World War II rates. A low of 4.5% might offset the sting of how your

mutual funds, 401K, other retirement plans, and the rest of your investments are performing. However, those who experienced a drop in income; those trying to sell their homes, which have dropped in value at least 11% Hamptons-wide in the last year; and those whose equity in the home is less than 20%, shouldn’t be overly optimistic on either refinancing or tapping into existing equity to raise cash. Professor Carrington at George Washington University Business School used to say, “You never borrow money to pay bills. Doing that doesn’t address the problem and just puts you in more debt, making a bigger problem. Borrow money to finance expansion, or invest in other income producing ventures.� The smart money is reducing costs because they can afford to, while those in trouble aren’t eligible to reduce the very costs that might be sinking them. In other words, those who don’t need the loans can get them; those who really need help are unwelcome. With one out of 10 homes with financing in some form of foreclosure or delinquency nationwide, it’s a dilemma. How will this trend end? With jobs disappearing at record rates, savings at record lows and confidence in Wall Street shattered, not many people are predicting 2009 to be the best year ever. Many are just hoping it won’t be the worst year ever.

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Dan's Papers 2008 Holiday Issue  

Dan's Papers, the 51-year-old bible of the Hamptons, is owned by Manhattan Media, a multi-media publishing company based in New York City,...

Dan's Papers 2008 Holiday Issue  

Dan's Papers, the 51-year-old bible of the Hamptons, is owned by Manhattan Media, a multi-media publishing company based in New York City,...

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