Monthly Archives: July 2009

What Do Options and Mortgage Fraud Have in Common?

Maybe some time in the “Big House”, and a reduction in your 401K.

Brokers, do you hae a listing whereby you find out there’s someone who owns “an interest” in a property you have listed, but that person is not on title?  Ask your agents.  They don’t volunteer this willingly till the offer comes in and the Seller says, I’ll have to get with Joe, and let you know”.   You need to be involved here.

Brokers, find out if your buyer agents have an offer in on a Short Sale that has an Option-Holder (who is not on title).  Your agent may not understand what is going on.  You need to be involved here, too.

Is an Option illegal?  Not usually.

But, it is if the purpose of the Option is to circumvent state licensing laws or to defraud the lender from reaping the most possible from a Short Sale.

Question:  If a lender agrees to short a loan of $200,000 by writing off $50,000, and accepts the buyer-seller agreement, no problem.  What if the lender agrees to this agreement, only to find out that there was a simultaneous closing that was for $10,000 more than what the lender received?  Who pays the $10,000?

You and me.  Yes, the losses are what we the taxpayers shell out through the Feds to make up all the bank losses.  If there were only a $40,000, instead of a $50,000 write off, we would not have to shore up the banks any where near as much as we will if the short sales continue to have so many hands in the pot.

Would the RTC hae done a better job of clearing the market of toxic assets?

Real story:  one of my agents and I were doing an Open House at one of our listings.  Sheepishly my agent told me that the property was scheduled for a Trustee Sale.  Note:  In AZ we use Trust Deeds and a non-judicial foreclosure period of 90 days from filing of the papers to the Trust Sale.  Agent unsure of date.  So, will the Seller agree to go through the process of filling out and submitting to the bank, short sale papers, ask I?  I couldn’t get a straight answer and had to get out my pliers.

“Why hasn’t the Seller spoken with the lender and asked for a packet if she’s without a job and cannot afford to pay the loan on this 2nd home?”

“A what?”

“The Seller did what?”  Gave 1% interest in the house to a man she hardly knew to do property management?  Unlicensed?

Yes, the story goes down hill from here.  My agent then continued to tell me that that same “property manager” was going to remove the cabinets the following week.

Some of you don’t know me… but by now can guess…

I said, “you call the Seller and tell her that if one cabinet is removed from this property I will make it my life focus to make certain that the person removing the cabinets spend time behind bars!”  I should have been more inclusive.  The next week the cabinets were there but the light fixtures, appliances, etc. were gone.

That agent is no longer with me.

People, that is mortgage fraud!!!

Watch this video:

Dick Fryer is a member of the Floride Real Estate Commission and he believes, as do I, that real estate professionals are eventually going to find themselves in a world of hurt just by turning a blind eye to the hanky-pank that’s taking place.  By the way, the term “wholesaler” is a synonym for “dealer”.

Here’s what the AZ Attorney General Terry Goddard just filed:

Brokers, ask your license law officials about these issues, call your attorney and discuss transactions like this with him/her, and for heaven’s sake, get involved with your agent’s short sale and Rent-to-Own transactions.  Look at me, sounding like the lady in the drug ads telling parents to get involved.

Must get back to writing the AZ CE course…  look for a post about the “Shrink-Wrap House”… more on short sales, AZ’s amendment to the anti-deficiency judgment statute, and bankruptcies.




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Don’t Post Your Business Stuff on My Facebook Page…PLEASE!

How did something I enjoyed so much become a place that I no longer want to go?

Facebook is for my family and friends.  If I “connect” with you, I hope you will respect my page and only post to me things that are about you personally…maybe an occasional post about what you’ve been doing in business, or where you are going in business, BUT, please do not try to solicit me to buy your books, your training programs, or your children!

LinkedIn, I allow people to try to solicit me.  I figure it’s all about business.  But, not my Facebook page.

Today I “disconnected” someone I “connected” with recently.  His first post to me was an out and out solicitation.  Flush!

Using someone’s Facebook page to advertise your wares is like pinning a note on someone’s child and sending them home to Mom.  Mom does not like that.

We’re all looking for ways to “connect” and I am glad to “connect” with strangers as long as they don’t abuse their welcome.  My page has become so cluttered with videos that I will never watch, business news and comments from people I don’t know, and information I don’t need.  Can I be the only person who is getting p—-d off?

You may “tweet” me with business news, or post on my LinkedIn page, but PLEASE, discontinue posting to me on Facebook.  Give it to me on Twitter.  It goes away and does not go to everyone who views my page.  I’m about quality, not quantity.

It’s called Social Networking for a reason… Facebook is for my chosen friends or people I think I would like to have as friends.


Kathy Howe

Kathy Howe

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What does the NSA and AMY CHOREW have in common?

They both made my week!

NSA is the National Speakers Association.  It’s members include people you have only heard about or seen on TV.  They are the creme de la creme of the speaking industry.  I only wish I were a member.

Through twitter one day I received a “tweet” from someone who did a twitter search and found my name.  Michael Benidt introduced himself and we “tweeted” about our worlds.  He asked if I knew that the NSA was meeting the week of July 12-17 in Phoenix…I replied “no”…he asked if I had time to attend… I said I would find the time.  Why did he go this far with someone who was not a member of NSA.  As the President Elect of the Real Estate Educators Association (REEA) he thought his organization and our organization had common ground.  Now, friends, this is the ultimate in Social Networking!

I’m not sure what NSA got out of meeting me, but I can tell you what I got out of the National Speakers Association:

  • They are competent, dedicated, professional, and in a class by themselves
  • They put on one dy-n0-mite conference – thanks Sarah Michel
  • Their speakers push you to the max with ideas that don’t quit

I had the privilege of being invited to attend a CSP-only session presented by Michael Benidt and Sheryl Kay, Hidden Treasures of the Internet:

“New Online Survival Strategies:  How to Find Real Value in an Overloaded World”, at which, in the Twitter portion, I was introduced as a way in which Twitter can expand your SOI.

My privileged day then included sitting with them at the Conference Chair’s table and sharing the excitement of the speakers, holding the “windbag” with Steve Spangler‘s wife, and making new friends.

…as well as seeing those already in my SOI:  Amy Chorew, Rhonda Hamilton, Doug Devitre.  All are both NSA affiliates and REEA members.

Is there an ROI for Social Networking?  What do you think?

The next day I was in a real estate CE class presented by AAR with Amy Chorew as the presenter.  No disappointment there.  She rocks!  And her passion for what technology can do for your business is her gift to the classroom.

So what do these two have in common?  Me.

Oh no!  I’m not trying to be arrogant.  They both gave me such get-up-and-go that I’m afraid my to-do list will be perpetual.  Keeping up with change is almost a full time job, but to be good, you have to stretch.  I’m feeling like a 300 lb woman trying to get into a pair of Chico size O tights… there’s going to be a lot of stretching going on.


Oh, I might add that the day was probably an expensive one as I will now have to have an iPhone so I can “bump”, apply to the NSA for membership, and plan on adding 3 more conferences to my already committed 8 conference dates over the next year.  Anyone want to adopt and fund one slightly aged, inquisitive, passionate, often outspoken blonde?

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I-17 Closed 7-15 Due To Brush Fire

Going to Phoenix in the summer is always iffy!  During the monsoons we have lightening (the dry type as well as storm lightening) which ignites the now-dry spring plant growth like a match to cotton.  The car is always packed with water (or coffee – can’t do the AM without it!) both directions.  Toolbox…well, actually mine is a toolcase with flags, bungee cords, a sledge hammer, and open house signs.

Yesterday’s fire had been phoned in to me after meeting a friend for lunch.  So what did I do?  I called DPS and asked how long they anticipated the fire to burn and the roads to be closed.  They said 1-2 hours, so I planned my shopping accordingly!  An extra stop at Marshall’s at 18th St & Camelback cost me a bit more than I had planned…

Headed up the Hwy and screached to a halt just south of Black Canyon City.  Turned off the engine, grabbed an Open House sign to block the sun on the drivers side and made a few calls.  Got bored…got out of the car…4″ heels get the attention of others and other drivers came over to talk.  They weren’t aware of the fire, so with them standing there I recalled DPS who said the northbound lanes were opened 5 minutes earlier but it might take another 10 minutes to move traffic.

Can you even remember life without a cell phone?

I carried that Motorola “brick with an antenna” starting 1988 and paid $.32 per minute.

Oh, the fire was started by a car fire this time, but as I speeded across I-17 to Copper Canyon, the lightening was vicious and at one point I thought it had hit very near me.  Mother Nature having a snit.

Have a great day!

Kathy Howe

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Is What You Want It To Be?

Did you realize that you cannot put an address in the Search box on the splash page of and get to that listing directly?

Do you know that you have to scroll down quite a way to find out who has the property listed?  And then you only get a name and phone number unless the broker has paid to “enhance” the listing with a web address, etc.

Does the consumer realize that there are “rules” at that don’t allow REALTORS to identify the broker who has the listing?  We get fined for violations if there is anything that identifies the listing agent in a photo or even the remarks.

Do you know that if I want to direct you to my website as the listing agent, I have to pay to “enhance” the website?

It may be the broker’s listing, but is designed to hand off consumer leads to the person who spends the most money on “enhancing” or advertising with

Those of us who truly believe in the consumer being a real estate educated person believe that the more the consumer knows about the property, the more the consumer understands about the property, the offer, and the transaction.  Yet, we direct the consumer away from the listing agent (unless the agent “pays” to get the consumer to the agent).

Anyone else have a problem with as it exists today?


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Are You a Real Estate Professional?

Do you consider yourself a real estate professional?

First, maybe we should define “professional” as one who engages in a profession, which can be defined as:  “…a vocation or occupation requiring advanced education and training, and involving intellectual skills, as medicine, law, theology, engineering, teaching, etc…”   Actually the number 1 definition is from the 13th century:  “…the act of taking vows of a religious community.”

That was a revolation!

Are you that committed to the profession of real estate?

This AM I had the opportunity to read Stefan Swanepoel’s “The Wise REALTOR.“.

Thinking back to why I joined the ranks in 1986…actually I was waiting till I could start graduate school in the fall.  What happened next was that I fell in love with being a real estate professional and didn’t make it to grad school.  How about you?

It’s about the good times and the bad times.  It’s about the people.  It’s about being their family REALTOR.  It always has been…

Great read, Stefan.

Kathy Howe

PS.  Maybe that’s how I’ve gotten through 3 downturns.

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Retiring? Taxes on Retirement Funds

Honestly, I think I get my best work done in the middle of the night!

While checking Twitter and Facebook, I ran across this article from Retirement Information Living Center…

Taxes by State

Sales Taxes 
State Sales Tax: 6.3% on average (food and prescription drugs exempt).  Arizona does not have a “Sales tax” but does have a gross receipts tax called the Transaction Privilege Tax. All counties and some cities levy a sales tax that could bring the combined tax rate to 10.7%.
Gasoline Tax: 19 cents/gallon
Diesel Fuel Tax: 28 cents/gallon
Cigarette Tax: $2.00/pack of 20
Water Use Tax: 65 cents per 1,000 gallons of water used.

Personal Income Taxes
Tax Rate Range: Low – 2.59%; High – 4.54%
Income Brackets: * Lowest – $10,000; Highest – $150,000  
Number of Brackets: 5
Personal Exemptions: Single – $2,100; Married – $4,200 with no
dependents, $6,300 with one dependent; Dependents – $2,300; 65 years or older – $2,100
Standard Deduction Single: – $4,521; Married filing jointly – $9,042
Medical/Dental Deduction: Allows deductions for all qualified medical and dental expenses.
Federal Income Tax Deduction: None
Retirement Income Taxes: Social Security and Railroad Retirement benefits are exempt.  Up to $2,500 total of military, civil service, and Arizona state/local government pensions are also exempt.  All out-of-state government pensions are fully taxed.  Frequently asked tax questions
Retired Military Pay: Up to $2,500 of retired pay and/or survivor benefits excluded.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes 
There is no state property tax.  Tax jurisdictions set tax rates, which may vary considerable from one area to another. Property tax is administered by county assessors.  Single homeowners 65 and older who earn less than $3,750 and married couples who earn less than $5,500 are eligible for a tax credit of up to $502.  

Persons at least 65 years old who have resided in their primary residence for at least two years and have total income not more than four times the Social Security supplemental security income (SSI) benefit rate may apply to the assessor by September 1 to have the valuation of the primary residents and up to 10 acres of adjoining undeveloped land frozen at the full cash value when the application is filed.

Arizona also taxes personal property, which is defined as all types of property except real estate.  Taxable personal property includes property used for commercial, industrial and agricultural purposes.  Personal property is considered to be movable and not permanently attached to real estate.

In lieu of a personal property tax on automobiles, the state imposes an annual motor vehicle license tax.  The fee to register an automobile in Arizona is $8.00 (or $8.25 in metro Phoenix and Tucson, including a 25-cent air quality compliance sticker fee), plus an air quality research fee of $1.50 and a vehicle license tax (VLT).  The VLT is based on an assessed value of 60% of the manufacturer’s base retail price reduced by 16.25% for each year since the vehicle was first registered in Arizona.  As of Dec 1, 2000, the rate is calculated at $2.80 for new vehicles or $2.89 for used ones for each $100 of the assessed value.  For example, for a new vehicle that costs $25,000, the first year’s assessed value would be $15,000 and the VLT would be $420.  The second year the assessed value would be $12,562.00 and the VLT would be $363.06. Call 800-251-5866 for details.  For information on property tax relief for seniors, click here.

Inheritance and Estate Taxes
There is no inheritance or gift tax and the estate tax does not apply to decedents whose date of death is on or after January 1, 2006.

For further information, visit the Arizona Department of Revenue site.  For questions about moving to Arizona, click here. For other tax questions, call 602-255-3381.
* For joint returns, the taxes are twice the tax imposed on half the income.

 If you are a retiree moving to Arizona, this is important information.  Just to be certain, contact the ADOR to be certain the information above is current.

Have a great day.  Now I’m going back to sleep.



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