CLICK THE MENU ITEM ABOVE FOR A MORE COMPLETE HISTORY OF THE FOLLOWING AREAS:

THE WEST VILLAGE: There is no neighborhood like the West Village (Greenwich Village, the village). Its a diverse neighborhood that has a life of itself, flowing with artists and musicians, and actors.

In the mid-19th century, however, as the city spread north of 14th Street, the Village became the province of immigrants, bohemians, and students (New York University [NYU], today the nation's largest private university, was planted next to Washington Square in 1831). Its politics were radical and its attitudes tolerant, which is one reason it became a home to such a large lesbian and gay community.

ABOUT SOHO: Starting at Houston (pronounced how-ston) Street, walk south down Broadway, stopping to browse the stores and vendor stands between Houston and Prince streets. The sole remaining museum on the block is the New Museum of Contemporary Art, devoted exclusively to living artists. Within the Prada store at 575 Broadway, Dutch architect Rem Koolhaas has created a high-tech setting for the Italian house of fashion. Several art galleries share these blocks as well, most notably at 568 Broadway, which houses 10 galleries, and the trendy Armani Exchange store on the ground level.

ABOUT CHELSEA: As Broadway marches north and west across Manhattan it Chelseaforms a series of squares beginning with Union Square at 14th Street. The square itself hosts a popular Greenmarket, and before Christmas, a crafts market. In this neighborhood are some of the city's trendiest restaurants lining Park Avenue South up to 23rd Street. Madison Square, the site of the original Madison Square Garden, is dominated by the Metropolitan Life Insurance Tower and the Flatiron Building (20-stories and triangular). It was once the end of "ladies mile," the city's most fashionable shopping district along Broadway and Sixth Avenue; this area still has great shopping. To its east is Gramercy Park, a small, fenced park acessible only to residents of its surrounding townhouses. Theodore Roosevelt was born in this neighborhood.

Some programs eliminated altogether

In many instances, banks and mortgage lenders discontinued programs that many critics of the lending frenzy say exemplified the loans they considered risky.

"Globally, no one will give a loan to any no-income-check borrower who is borrowing over $417,000 if they have been over 30 days late in paying their mortgage over the past 12 months," said Moskowitz.

No-doc buyers do not want their income checked in order to qualify for a loan -- these are often called "liar loans" -- and the buyer will pay more for the lack of scrutiny. Banks have either tightened standards or abruptly halted these loans, said brokers and lenders.

"A lot of banks are [also] doing away altogether with their foreign national programs," said Ladesou, describing lending programs for international buyers who do not live in the U.S. In many cases, foreign nationals are plunking down 40 percent capital and entertaining interest rates from 9 to 11 percent, said mortgage brokers (see More lending oversight for overseas shoppers).

Several mortgage lenders who spoke off the record said that major institutions including Credit Suisse, Citibank and Chase had simply stepped back from mortgage credit. Credit Suisse reportedly stopped buying home equity lines; Citibank stopped offering no-income verification loans for salaried people; and Chase eliminated its no-income verification loans for salaried borrowers as well as its stated-income products.

Even churches feel the heat

Even churches and nonprofits are seeing a pushback from lenders.

The Federal Housing Administration (FHA), Moskowitz said, is looking at eliminating or severely restricting the current practice of allowing nonprofits to provide the down payment for buyers on FHA-insured loans under an "arrangement" in which money is reimbursed to the nonprofit by the seller.

Lenders pull out of risky hotel-condo commitments

But if loans are getting more expensive for individuals, higher borrowing costs are also taking a toll on developers. The problem is most acute in new developments and with new condo properties that haven't been built yet.

Ladesou said the hotel-condo type of property has become very hard to finance in the tightening environment because its format has not yet been proven in the marketplace.

In the past five years, developers have been able to require down payments and obtain preapprovals on buyers' loans so they can sell their projects prior to completion. But in many cases, those promises from lenders have dried up, even on previous commitments.

For that reason, Ladesou said lenders were changing terms or asking for new commitments from developers, such as mortgage contingencies, that protect the down payments of buyers if their lending terms change.

Ladesou said she could not find any banks to do the financing on a hotel-condo project whose primary lender suddenly backed out with 327 out of 368 units sold. "These are loans the banks think people will walk away from," she said.

On another hotel-condo project, Ladesou said many of the buyers who put money down 18 months ago don't qualify under guidelines set by lenders today, and some are walking away from their deposits -- as much as $50,000 to $100,000, representing the 5 to 10 percent down required for the average $1 million units. "I haven't seen a lot of those, but we're in new territory again," she noted.

Brokers report that the usual way of doing business, where banks will make loans on a future development based on the strength of the market, may soon be a thing of the past.

In Long Island City, the developer of the Solarium at 5-39 48th Avenue, 539 Realty , was recently asked to personally guarantee the $22 million loan for its development, said Rick Rosa, a Prudential Douglas Elliman broker who is marketing the project.

"It's a big sign of the times: This is only because we are going condo, because if we were going rental, there would be no guarantee required," said Rosa.

He said two other boutique condominium developments by the same builder, one worth $2 million and the other worth $1.4 million, did not require the same guarantee. Despite the recent tightening by banks, Long Island City is holding up as well as Manhattan, with strong price performance averaging about $750 to $770 per square foot. (Manhattan's average now starts at about $1,000 to $1,200 per square foot).

"The market here is still really strong," said Rosa. Still, there is plenty of competition in LIC. Major builders including Rockrose Development, Avalon Bay Communities and Toll Brothers all have large projects under way.

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