Thomas Stanley, Ph. D. is back at it again with his newly released book “Stop Acting Rich.” His name should be familiar to you because he is the author of “The Millionaire Next Door” and “The Millionaire Mind.”
I loved his first two books and when I saw his new book, I couldn’t resist buying it. The message that permeates each book listed above is that most people look rich because they live in big homes or drive expensive cars, but when examined closely, they have accumulated very low levels of wealth. In other words, they wear big hats but have no cattle.
For some reason, we seem to measure our success in life by how we compare to others. Is our house bigger than theirs? Is my car nicer than Jim’s down the street? To feel successful, many people fall into the trap of buying things simply to impress others.
One of the main lessons Mr. Stanley makes throughout this book is that the amount of wealth you accumulate in your life correlates directly to the size and value of your home. Here’s a very telling quote from the book:
“If you examine homes by value from the lowest to the highest, you would find that as the value of the homes increases, so does the proportion of people who are living well above their means.”
The more expensive your home, the more you’ll be forced to spend on home repairs, maintenance and upkeep. This is hard enough, before you factor in what you’ll have to spend to keep up with your neighbors. If you buy a high-end home, you’ll end up sending your kids to expensive private schools and you’ll be forced to buy them all of the expensive clothes and gadgets the other kids have in the neighborhood.
The reason this happens is because it’s hard to avoid copying what you see every day. You won’t want to look like some schmuck who drives a rusty old car and sends his kids to the public schools in out-of-style clothes from Kmart.
The trick is to live in a nice home in a nice neighborhood that allows you to live below your means. It’s better to be a high earner in an average neighborhood than it is to be a low earner in a high-end neighborhood. Remember the old saying about “buying the worst house on the best street?” Well, as it turns out, this “best street” might actually lead you to the poor house.
Most of the millionaires profiled by Mr. Stanley live on less than 80 percent of their income. They are frugal and focus their attention on investment rather than consumption. Their goal is to convert income into wealth, which is significantly different than people who act rich. (Stolen from "Broker / Agent Social" by Rob Minton.)

Short Sale Myths
A short sale can be an excellent solution for homeowners who must sell and owe more on their homes than they are worth. Unfortunately, a number of myths about short sales have developed, and it is important to understand the reality of this process should you find it meets your current needs.
Myth #1 – The Bank Would Rather Foreclose than Bother with a Short Sale.
This is one of the most common misconceptions. The reality is that banks do not want to foreclose on your property because the foreclosure process is incredibly costly. Banks, investors, and even the federal government have all publicly stated that if a person is qualified for a short sale, the deal needs to be considered. Overwhelmingly, banks receive more on their investment through a short sale than a foreclosure.
The qualifications for a short sale include:
Financial Hardship – There is a situation causing you to have trouble affording your mortgage.
Monthly Income Shortfall – “You have more month than money.” A lender will want to see that you cannot afford, or soon will not be able to afford your mortgage.
Insolvency – The lender will want to see that you do not have significant liquid assets that would allow you to pay down your mortgage.
Myth #2 – You Must Be Behind on Your Mortgage to Negotiate a Short Sale.
While this may have previously been the case, today lenders are looking for verifiable hardship, monthly cash flow shortfall, or pending shortfall and insolvency.
If you meet these three requirements and believe that you soon may be unable to afford your mortgage, act immediately. Any delay could limit your options. Do not wait until the countdown clock to foreclosure has started and you have even less time left.
Myth #3 – There is Not Enough Time to Negotiate a Short Sale Before My Foreclosure.
This is a myth that probably hurts homeowners the most. Many do not realize that foreclosure is a process, and that there is time to make decisions that may result in better outcomes.
The foreclosing party—in most cases a lender—can stall a foreclosure up to the final day of the process. Today, many lenders will stall a foreclosure with as little as a phone call from you explaining that you are trying to sell, and almost all lenders will stall a foreclosure with a legitimate contract. For real estate professionals who understand foreclosures and short sales, there is time available until the foreclosure process is complete.
Myth #4 – Listing My Home as a Short Sale is an Embarrassment.
It is understandable to have reservations about letting the world know that you owe more on your home than it is worth. However, according to recent estimates, more than one out of eight homeowners in the U.S. is in the same situation. You are to be congratulated for admitting you need help, taking action, and finding a professional who can work with you toward a solution.
With recent estimates showing 40-60% of U.S. sales will be short sales or foreclosures, you are not alone.
Myth #5 – Short Sales are Impossible and Never Get Approved.
This is a complete falsehood. Are short sales more difficult to execute? Yes. Do you, as a homeowner, need to learn about a new process? Yes. Are they impossible? Absolutely not.
For example, agents with the Certified Distressed Property Expert® (CDPE) Designation receive thousands of short sale approvals on a monthly basis. These professionals have undergone extensive training in methods to help homeowners in distress and process short sales. While there are no guarantees in any transaction, more and more short sales are being approved regularly. This is far from an impossible process.
Myth #6 – Banks are Waiting on a Bailout and Not Accepting Short Sales.
You may have heard this, but the reality is that banks (and the U.S. government) are trying to do anything they can, within reason, to avoid foreclosing on properties. It is preposterous to believe they would deny a short sale in hopes that some future legislation would pass and pay them for losses.
Today, more banks are aggressively pursuing short sales and working with agents who understand how to process them. Freddie Mac recently hosted a national training Webinar for real estate agents where they expressly stated the organizational goal of “eliminating distressed assets through modification or short sale.”
Myth #7 – Buyers are Not Interested in Short Sale Properties.
This is a myth that potential sellers hear all the time. Thankfully, this is just not true. In fact, many agents are getting calls from buyers who say they only want to look at foreclosure and short sales.
For buyers, short sales and foreclosures have become synonymous with “good deals.” More specifically, international buyers are targeting these properties. Listing with an experienced agent who is educated in the short sale process will provide you with a great chance of quickly seeing a contract on your property.
In conclusion, Agents with the CDPE Designation have been trained in all aspects of the short sale process, and know how to deal with the parties involved in foreclosures. Finding a CDPE can explain what options you have, and get you on the path to recovery.

Tips for claiming the Homebuyer Tax Credit

Seven Important Facts about Claiming the First-Time Homebuyer Credit

IRS Tax Tip 2010-27
If you purchased a home in 2009 or early 2010, you may be eligible to claim the First-Time Homebuyer Credit, whether you are a first-time homebuyer or a long-time resident purchasing a new home.
Here are seven things the IRS wants you to know about claiming the credit:
You must buy – or enter into a binding contract to buy – a principal residence located in the United States on or before April 30, 2010. If you enter into a binding contract by April 30, 2010, you must close on the home on or before June 30, 2010.
To be considered a first-time homebuyer, you and your spouse – if you are married – must not have jointly or separately owned another principal residence during the three years prior to the date of purchase.
To be considered a long-time resident homebuyer you and your spouse – if you are married – must have lived in the same principal residence for any consecutive five-year period during the eight-year period that ended on the date the new home is purchased. Additionally, your settlement date must be after November 6, 2009.
The maximum credit for a first-time homebuyer is $8,000. The maximum credit for a long-time resident homebuyer is $6,500.
You must file a paper return and attach Form 5405, First-Time Homebuyer Credit and Repayment of the Credit with additional documents to verify the purchase. Therefore, if you claim the credit you will not be able to file electronically.
New homebuyers must attach a copy of a properly executed settlement statement used to complete such purchase. Buyers of a newly constructed home, where a settlement statement is not available, must attach a copy of the dated certificate of occupancy. Mobile home purchasers who are unable to get a settlement statement must attach a copy of the retail sales contract.
If you are a long-time resident claiming the credit, the IRS recommends that you also attach any documentation covering the five-consecutive-year period, including Form 1098, Mortgage Interest Statement or substitute mortgage interest statements, property tax records or homeowner’s insurance records.
For more information about these rules including details about documentation and other eligibility requirements visit IRS.gov/recovery.
Links:
1040 Central
First-Time Homebuyer Credit Information Center

I am so excited!

The mail came yesterday! My seeds are here!

This weekend I get to plant 3 kinds of lettuce, radishes, peas, chard, and spinach. I also get to start tomatoes and chili in egg cartons, for transplanting later.

So why did I have to wait for the mail? Why not just schlep on down to Wal-Mart and buy my seeds there? Why start the salsa in the window instead of buying already started plants and plopping them into the ground next May?

I made a big mistake. I read "Animal, Vegetable, Miracle" by Barbara Kingsolver. Then I started researching heirloom seeds and GMOs and local economies and now I think that I'll get struck by lightning if I go to Wal-Mart. (I remember one of my favorite Emo Phillips comments: "I went to Wal-Mart, which is where everybody goes sooner or later if they've lived a life without God.")

So the seeds that came in the mail are heirloom seeds. They're not hybrids, they're not Genetically Modified Organisms or what ever the "O" stands for, they're, wow, like, tomatoes and lettuce that looks like what Thomas Jefferson grew in his garden. They're (hopefully) going to be those strange bumpy, warty vegetables that you see in the health food stores.

The seed packages came with handwritten titles and instructions, all packaged in a brown paper envelope. I felt a little illicit opening it, like I had gotten contraband or maybe porn. I chuckled at what the postman had to have thought - how disappointed he would be if he knew that it was just heirloom seeds! I will never tell him.

Old seeds - I confess that I like this idea.

I like that the food that my family and I will be eating will be real, instead of Monsanto mutants.
I like that next year I won't have to buy these specific seeds again, because the seeds out of the vegetables will be viable, just like they should be. It's disconcerting that I've become so accustomed to the limitations of hybrids that I think that it's pretty cool that seeds will sprout.
I'm actually a little bit nervous. Me, who has been gardening for 45 years. (My first garden was when I was 5 or so. My Mom gave me radish and zinnia seeds. I was so proud of my radishes, and refused to harvest and eat them. I wonder if they're still there at that house in Prescott, those poor petrified radishes?)

So here's my holiday weekend. I get to go out to my listing at Merritt Ranch (Ooh! An opportunity for a shameless plug!) in Cornville, the beautiful 10.41 irrigated acres of horse property, Arizona realtor.com ID# 144467, and see if Megan will let me carry away some good aged horse manure. I'll get blisters working it into the dirt. I'll fix the electric fence, I will certainly get into it a time or two, I will cuss, and I will plant some good salad and salsa.

Yes, this is my idea of fun. The Jeep will smell funny for a while, but it's a good funny.

Life is good, warty tomatoes and all.

The Sedona Verde Valley Association of REALTORS® has a message and a request for all of you Buyers out there.

Congratulations on your decision to take advantage of this buyer’s market, and kudos for collecting the tax incentives available to you! The REALTORS® are glad that you have chosen to investigate the purchase of a new home, and of course we’re happy to help you with it. We understand that viewing properties is exciting and fun – it is for us, too.

However, we’re seeing a problem and we need your assistance.

When Buyers make the choice to start looking, they usually play around for a while on realtor.com, and then they choose a REALTOR® to work with. Your REALTOR® will enter you into our system that automatically emails you whenever a property that fits your needs comes up.

This is where the fun starts.

As a Buyer, you get emailed a listing. It looks like a winner and so you jump into your car to go see. This is all fine and wonderful, and we’re glad that you’re looking at the outside of the house and checking out the neighborhood – that’s always a great idea!

But (Isn’t there always a “but?”) here’s where the problem happens.

A potential Buyer finds a house and it looks intriguing and so they jump out of their car and wander around the yard and then they put nose prints on the windows and suddenly the owner or the tenant comes out of the door, wondering loudly why these people are trespassing?

This situation can get ugly, and it’s been happening a lot.

Buyers, please don’t assume that a house is vacant. Even if it is empty it’s still private property and you need permission to be there. Often, the police have been alerted to patrol and watch these homes closely, especially the bank owned homes.

So here’s the plan. Absolutely drive around and scope out the homes and decide which ones you want to see inside. Then call your REALTOR® and have them make an appointment. Don’t worry about bothering us. Thank you, but this is one of the best parts of our job. We like to show houses.

Thank you so much! If you have questions, please don’t hesitate to call or email the Sedona Verde Valley Association of REALTORS® at 928-282-5409, or email us at info@svvar.com.

Happy hunting!

The Mago Earth Park Statue that's been erected between Cottonwood and Sedona. OK, OK! I 'll comment.

Let's start with some background. Within the outer City limits of Cottonwood, right next to and looking at the new Immaculate Conception Catholic Church, a statue has been erected. The Korean owner of the property explains that she is a representation of Mago, (pronounced "mah-go") which translates roughly as "Mother Earth."

She's huge. The statue and base total 50 feet high. She also has an entourage of numerous other statues, (all comparatively tiny, all slightly ludicrous) of Jesus, Kokopelli, the Virgin Mary, 2 funny headed guys, 3 Disney-esque dwarfs, a Native American, Poseidon, a bunch of brightly colored and sparkly children............ you get the idea, all capering around her feet. I find the Mago circus to be kind of charming and amusing when I drive by.

Nobody that I've spoken to about Mago agrees with me about the whole thing being amusing. The vocal locals are up in arms. We've had weeks of poisonous letters to the Editor in the Verde Independent. The objections seem to be:

She's big.

She's a pagan idol.

There are tentative plans for her to be lighted at night.

She's not a Christian.

She's wasn't there before and it's a change.

She's mostly white, and doesn't blend in with the mostly brown landscape.

Even though she's white with blond hair her features are Asian.

Why is she named "Magoo" when she doesn't look anything like Mr. Magoo? Where are her horned-rimmed glasses?

Why does the Mago Earth Park get tax-deferred church status?

She's different and we don't like different.

If you're not from here, one of the things to understand is that Mago went up shortly after they opened the brand new Catholic Church next door. Like Mago, the Church is gorgeous. Like Mago, the Catholic Church is also huge and lighted at night and much lighter in color that the surrounding landscape and gets tax-deferred status and also wasn't there before. On my own personal hugeness scale, Mago is a 2 or 3 and the Church is an 8 or 9. See the picture, above? That's Mago to the right of the Church.

But you know what? It doesn't matter what my opinion is. If Mago was legally installed then I have no more right to complain than my neighbor has if I paint my house a color that they don't like.

But you know what else? This is my blog and I can say what I want, so I will voice my opinion, whether it matters or not.

We've had months of citizens yelling and almost coming to blows and writing letters to the Editor and showing up at City Council meetings, voicing opinions on both sides of the Mago issue.

Folks! It's a statue! We have hungry children in Cottonwood. We have homeless people. We have abused people, we have people sleeping under the bridge, we have animals dying in the shelters, we have life and death issues around here and YOU SHOW UP TO COMPLAIN ABOUT A FREAKIN' STATUE? Where were you when that baby was beaten into the hospital a few weeks ago? Did you show up then, expressing your outrage? Where were you when The Mission was concerned that they were running out of food? Did you write a letter to the paper? Did you show up with coats and blankets and food for the homeless when it got cold? People are homeless and dying and yet you sing "God Bless America" about THIS? If Mago is the only place that you're outraged then you should be ashamed of yourself.

That's what I think.

I've been pondering humans and our natures. If you had asked me a few days ago if I was a civilized human being or not, I would have told you, "Yes, most of the time." I've had moments in my life where I was not the least bit well-mannered, but I usually do OK in the civilization department.

But then something happened.

My just-turned-5 granddaughter Turtle and I went for a walk. We were moseying along, discussing the weighty question of whether or not a troll could beat a dragon if they got into a fight. We had pretty much decided that the troll would win, but only if he had captured some fairy dust and harnessed its power. I had to bow to Turtle's expertise in this subject and blindly agreed with her reasoning and conclusions.

Suddenly, four big dogs boiled out of a hole in a fence and came at us, snarling and barking and growling and snapping.

Instinct is incredible. Before I even had the thought process that my granddaughter and I were in danger from these dogs, I had hoisted Turtle up onto my back. She was holding on with her legs around my waist and her arms around my neck. I suddenly had a stick in one hand and a big rock in the other, and I'm still not sure where those came from. These dogs were going to have to come through me to get to Turtle. I roared "BAD DOGS! NO!" in my biggest alpha-female voice.

The dogs screeched to a halt, surprised to see Turtle and I in the middle of their rumpus - they were playing and hadn't even noticed us. Instead of a pack of carnivorous predators bent on tearing us limb from limb, they were just a bunch of goofy slobbering Black Labs.

Some things are interesting about all this.

• I didn't think about any of my actions. My body knew what to do to protect the child that was with me, with no help or interference from my brain.
  
• I had no conscious thought about the stick and the rock. I guess that as we make our way through our lives our lizard brains note every possible weapon available in each area.
  
• Turtle also had instinct working. That she was on my back so quickly amuses me. (She doesn't normally do anything without at least 15 minutes of discussion first.) Her body knew what to do and did it.

• I had absolutely no thought for my own safety - I only thought about Turtle. Those dogs would have had to go through me to get to her. That instinct was fascinating. I've had my children - survival of the species mandated that I was going to sacrifice me to save the young female. I would have, too.
  

So why am I talking you about this on a real estate blog? Well, first of all, we left strict real estate behind months ago on this space - it was boring. Besides, what taps more closely into human nature than shelter, and home?


The only difference between the Neanderthal that I might have been thousands of years ago and the woman on Mingus View Drive last Saturday is the quality of our clothes.


Once I stopped shaking I noticed how many of Turtle's and my actions during that 5 or 10 seconds were pure instinct and reflex. I did what I did, and Turtle scurried up my back like a spider instead of stopping to explain that she can talk to the dogs, or that she's Wonder Woman or that she should just fly away.

When we got home to family dinner I paid attention to how much of our interactions follow old prehistoric paths. Pecking orders are strong, yet fluid. (Jess, my youngest son, stepped aside to let his older brother to fill his plate first. But then when a child screeched we all stepped aside so that Jess, the medic, could get down the hallway. Like that.)

The next day I showed property. The Buyers and I talked about leverage and investments, but the driving force was shelter and roots. This couple wanted safety and their own territory and their own place to be, inviolate from the rest of the world. We all want that - a safe, warm cave.


I showed them a bank-owned repo, and we saw some more primal human fallout. The previous owner had not only taken everything of value from the property, but he had fouled this nest to the point that nobody else would ever want to live there. This previous owner had literally marked the corners of his territory.

So the next time somebody brags about how civilized they are I'll remember what happened with those dogs. I'll remember that my "civilization" is just a thin veneer over a cavewoman that would have taken those dogs on with her teeth, if necessary to protect a dearly beloved child. I'll remember that we all operate from truths and patterns that are identical to the truths and patterns of our ancestors, with very few alterations.



I realize that I am not a fully evolved, civilized human being - I am a cavewoman who wears Reeboks.