What Happens In “Escrow”?



An escrow is an arrangement in which a disinterested third party, called an escrow holder or settlement agent, holds legal documents and funds on behalf of a buyer and seller, and distributes them according to the buyer’s and seller’s instructions.


People buying and selling real estate often open a sale transaction with the settlement agent for their protection and convenience. The buyer can instruct the settlement agent to disburse the purchase price only upon the satisfaction of certain prerequisites and conditions. The seller can instruct the settlement agent to retain possession of the deed to the buyer until the seller’s requirements, including receipt of the purchase price, are met. Both rely on the settlement agent to carry out faithfully their mutually consistent instructions relating to the transaction and to advise them if any of their instructions are not mutually consistent or cannot be carried out.


Security Title provides professional escrow settlement services that are a convenience for the buyer and seller because both can move forward separately but simultaneously in providing inspections, reports, loan commitments and funds, deeds and many other items, using settlement as the central depositing point. If the instructions from all parties to the transaction are clearly drafted, fully detailed and mutually consistent, the settlement agent can take many actions on their behalf without further consultation. This saves time and facilitates the closing of the transaction.


The settlement process was developed to help facilitate the sale or purchase of your home. The settlement agent accomplishes this by:


  • Acting as the impartial “stake-holder,” or depository of documents and funds
  • Processing and coordinating the flow of documents and funds
  • Keeping all parties informed of progress on the escrow
  • Responding to the lender’s requirements
  • Securing a title insurance policy
  • Obtaining approvals of reports and documents from the parties as required
  • Prorating and adjusting insurance, taxes, rents, etc.
  • Recording the deed and loan documents
  • Maintaining security and accountability of monies owed and owing.

Down Payment Assistance

Down Payment Assistance





For first-time buyers, often the first thought that comes to mind is, “I need a down payment.” This is often followed by the question, “Now, where do I get that down payment?”


Depending upon the loan type, a home mortgage typically requires 3 to 5 percent down. If you have the money, then you’re set. But what if you don’t?  What if you’re renting? You can afford a mortgage within your means, but coming up with the down payment money needed to begin the transaction can be challenging. So, where can you turn?


One of the most overlooked sources of down payment funds is likely right under your nose—in the form of government bonds and local grant programs.


These programs either provide outright monetary grants for down payment or money to buyers in the form of a forgivable loan. In essence, the government will help you buy your home and you typically only have to pay back the money if and when you sell that same property.


In the past it was challenging to find these special programs, but now all you need is your agent, a computer, an Internet connection, and a search portal such as Google or Yahoo.  Enter the search terms “down payment assistance (followed by your city, state or province)” and see what pops up! It might just be the answer to helping you buy your first home.




Jenn Woolley
(602) 510-5554
Professional Real Estate Consultant
Keller Williams Integrity First Realty



This has absolutely nothing to do with AZ Real Estate nor Phoenix Communities but I laughed sooooo hard that I thought I would share it with you.  Laughter is the spice of life!  Enjoy!



Pocket Tazer Stun Gun, a great gift for the wife. A guy who purchased his lovely wife a pocket Tazer for their anniversary submitted this:
Last weekend I saw something at Larry’s Pistol & Pawn Shop that sparked my interest. The occasion was our 15th anniversary and I was looking for a little something extra for my wife Julie. What I came across was a 100,000-volt, pocket/purse- sized tazer. The effects of the tazer were supposed to be short lived, with no long-term adverse affect on your assailant, allowing her adequate time to retreat to safety….??
WAY TOO COOL! Long story short, I bought the device and brought it home. I loaded two AAA batteries in the darn thing and pushed the button. Nothing! I was disappointed. I learned, however, that if I pushed the button and pressed it against a metal surface at the same time; I’d get the blue arc of electricity darting back and forth between the prongs.
Unfortunately, I have yet to explain to Julie what that burn spot is on the face of her microwave.
Okay, so I was home alone with this new toy, thinking to myself that it couldn’t be all that bad with only two triple-A batteries, right? There I sat in my recliner, my cat Gracie looking on intently (trusting little soul) while I was reading the directions and thinking that I really needed to try this thing out on a flesh & blood moving target. I must admit I thought about zapping Gracie (for a fraction of a second) and thought better of it. She is such a sweet cat. But, if I was going to give this thing to my wife to protect herself against a mugger, I did want some assurance that it would work as advertised. Am I wrong?
So, there I sat in a pair of shorts and a tank top with my reading glasses perched delicately on the bridge of my nose, directions in one hand, and tazer in another. The directions said that a one-second burst would shock and disorient your assailant; a two-second burst was supposed to cause muscle spasms and a major loss of bodily control; a three-second burst would purportedly make your assailant flop on the ground like a fish out of water. Any burst longer than three seconds would be wasting the batteries.
All the while I’m looking at this little device measuring about 5″ long, less than 3/4 inch in circumference; pretty cute really and (loaded with two itsy, bitsy triple-A batteries) thinking to myself, ‘no possible way!’ What happened next is almost beyond description, but I’ll do my best.. .?
I’m sitting there alone, Gracie looking on with her head cocked to one side as to say, ‘don’t do it, don’t do it!,’ reasoning that a one second burst from such a tiny little ole thing couldn’t hurt all that bad. I decided to give myself a one second burst just for heck of it. I touched the prongs to my naked thigh, pushed the button, and . .
I’m pretty sure Mike Tyson ran in through the side door, picked me up in the recliner, body slammed us both on the carpet, over and over and over again. I vaguely recall waking up on my side in the fetal position, with tears in my eyes, body soaking wet, both nipples on fire, testicles nowhere to be found, with my left arm tucked under my body in the oddest position, and tingling in my legs? The cat was making meowing sounds I had never heard before, clinging to a picture frame hanging above the fireplace, obviously in an attempt to avoid getting slammed by my body flopping all over the living room.
Note: If you ever feel compelled to ‘mug’ yourself with a tazer, one note of caution: there is no such thing as a one second burst when you zap yourself! You will not let go of that thing until it is dislodged from your hand by a violent thrashing about on the floor.. A three second burst would be considered conservative?
A minute or so later (I can’t be sure, as time was a relative thing at that point), I collected my wits (what little I had left), sat up and surveyed the landscape. My bent reading glasses were on the mantel of the fireplace. The recliner was upside down and about 8 feet or so from where it originally was. My triceps, right thigh and both nipples were still twitching.. My face felt like it had been shot up with Novocain, and my bottom lip weighed 88 lbs. I had no control over the drooling.
Apparently I pooped on myself, but was too numb to know for sure and my sense of smell was gone. I saw a faint smoke cloud above my head which I believe came from my hair. I’m still looking for my nuts and I’m offering a significant reward for their safe return!
P.s… My wife, can’t stop laughing about my experience, loved the gift, and now regularly threatens me with it!





If you think education is difficult, try being stupid !!!



Free House Cleaning For Women Chemo Patients!

 HOW COOL IS THIS PROGRAM?!!!  Help someone in need today :)


Cleaning for a Reason  


If you know any woman currently undergoing Chemo, please pass
the word to her that there is a cleaning service that provides FREE
housecleaning – 1 time per month for 4 months while she is in treatment.  


All she has to do is sign up and have her doctor fax a note confirming the treatment.  ‘Cleaning for a Reason’ will have a participating maid service in her zip code area arrange for the service.  



Please pass this information on to bless a woman going through treatment. This organization serves the entire USA and currently has 547 partners to help these women.

It’s our job to pass the word, and let them know that there are people out there that care.. Be a blessing to someone and pass this information along.

Do I Qualify For The Home Buyer Tax Credit?

 These guys always write a great article so I thought you might

like it…


Do I Qualify For The Home Buyer Tax Credit?


As we know by now current home buyer tax credit has been extended through the middle of the year. Under the new plan purchase contracts must be signed by April 30, 2010 (extended from November 30, 2009). However, the purchases have until June 30, 2010 to close in order for a buyer to qualify for the credit.



 In addition, the new plan is an expanded version of the original plan that allows some existing homeowners to take advantage of the credit as well. The question we have been receiving a lot lately is who qualifies for the new tax credit?

The latest version of the credit still provides up to an $8,000 tax credit for first-time homebuyers. However, it also provides up to $6,500 for existing homeowners looking to trade up to a bigger primary residence and who have already lived in their current home for five years. This expands on the amount of home buyers who can now take advantage of the tax credit.

In addition, to qualify for the full credit, homebuyers must have adjusted gross income of less than $125,000 or $225,000 for married couples filing jointly. Furthemore, the credit will only apply to homes sold for $800,000 or less.

For someone to be considered a first-time home buyer they have to have not owned a home ever or at least not in the past three years. They then will qualify for up to an $8,000 tax credit (any homes purchased below $80,000 will qualify for a credit of 10% of the purchase price).

In addition, to qualify for the existing home owner tax credit, you must have owned and lived in the same home for the last five years and now be purchasing a new home to live in. In this case the tax credit would be $6,500.

If you fall into one of these two groups then you may qualify for a tax credit with the purchase of a new home.



For more information on loan or refinance programs for existing and potential home owners, please contact Bill Kamboukos of Strategic Mortgage at (480) 219-3682



You can also can me anytime with any questions that you may have!

Jenn Woolley
(602) 510-5554
Professional Real Estate Consultant
Keller Williams Integrity First Realty

FHA Waives 90 Day Flip Rule





Measure to help bring stability to home values and accelerate sale of vacant properties


 In an effort to stabilize home values and improve conditions in communities where foreclosure activity is high, HUD Secretary Shaun Donovan announced a temporary policy that will expand access to FHA mortgage insurance and allow for the quick resale of foreclosed properties.  The announcement is part of the Obama administration commitment to addressing foreclosure. Secretary Donovan announced $2 billion in Neighborhood Stabilization Program grants to local communities and nonprofit housing developers to combat the effects of vacant and abandoned homes…


 …The waiver will take effect on February 1, 2010 and is effective for one year, unless otherwise extended or withdrawn by the FHA Commissioner.  To protect FHA borrowers against predatory practices of “flipping” where properties are quickly resold at inflated prices to unsuspecting borrowers, this waiver is limited to those sales meeting the following general conditions:


  • All transactions must be arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction.  


  • In cases in which the sales price of the property is 20 percent or more above the seller’s acquisition cost, the waiver will only apply if the lender meets specific conditions.


  • The waiver is limited to forward mortgages, and does not apply to the Home Equity Conversion Mortgage (HECM) for purchase program.



Specific conditions and other details of this new temporary policy are in the text of the waiver, available on HUD’s website at: http://www.hud.gov/offices/hsg/sfh/waivpropflip2010.pdf 


Call today with any questions that you may have, I look forward to hearing from you soon!


Jenn Woolley
(602) 510-5554
Professional Real Estate Consultant
Keller Williams Integrity First Realty

Debt Relief Act

Mortgage Forgiveness Debt Relief Act


By Chris Kaucnik and Michael J. Greenen


RISMEDIA, Oct. 30, 2008-No matter the circumstances, there’s a lot of stress a homeowner goes through in a foreclosure or a short sale. The loss of the home itself and any equity can add a lot of anguish to a situation that may be beyond the control of the homeowner from job loss or illness to changing market conditions.


Prior to December of 2007, if a homeowner lost his or her house due to a bank foreclosure, and the bank forgave any difference between the price it was sold for and what was owed, the homeowner would owe additional income tax on that portion.


Let’s say the homeowner owed $300,000 on the mortgage, but the foreclosure sale only brought in $200,000. Then the bank forgave the $100,000 shortfall. The homeowner would have been liable for the income tax on the $100,000 debt forgiveness from the bank.


The IRS considered this money effectively paid to the homeowner, and it would be taxable in their top bracket. The special reporting form 1099-C depicts the explanation of this exactly – the “C” stands for cancellation of debt and the law said this was taxable income.


Now, because of the unique stresses in the housing industry lately and on our whole economy, last December Congress stepped in to provide temporary relief in the form of forgiving this debt, but only for the 2007, 2008 and 2009 tax years. After that, the old rule applies again.


But Wait, There’s More


To be eligible for this tax relief, the mortgage must be for your principal residence. It does not apply to vacation, investment or other properties. And no more than $2,000,000 of forgiven debt can be excluded from taxable income. Well, most of us would fall below that threshold anyway.


Home Equity Loans


Another very important detail in this temporary tax break is if part of the forgiven debt was a home equity loan and used for purposes other than to build, buy or substantially improve the property, that portion is still taxable. In other words, home equity loans used for vacations aren’t included.


Short Sales


Now, what happens in a short sale? In brief, this can occur when a borrower is behind on the mortgage payments and the lender agrees he can sell his house for less than what is owed on the mortgage. But all proceeds must be turned over to the bank.


The portion of the mortgage the bank forgives, plus any commission expenses or other selling costs are taxable income if this debt is canceled. Yes, even the commission and selling expenses count. No free rides. But, again for taxable years 2007, 2008 and 2009 Congress has provided the same temporary relief in this short sale situation.


A short sale is not always the answer. First, the bank must agree to it and generally will weigh the cost of the short sale against the cost of a foreclosure.


Other Scenarios


There are situations where the bank sees a homeowner with a great credit history, but who is having trouble making mortgage payments for a legitimate reason. If the bank agrees to reduce the mortgage by say 25%, this is again considered a cancellation of debt and would have been subject to income tax. But for the above stated tax periods, this new, temporary tax provision forgives this income.


Why is there always a catch? If the homeowner does take advantage of debt cancellation by the lender, they are required, when they do eventually sell, to reduce the basis (original price of the home) equal to the amount forgiven.


What does that mean? A homeowner can now receive a $250,000 (single) and $500,000 (married) capital gain exclusion on the sale of their primary residence.


Here’s an example where the home was originally purchased for $300,000 and a married couple is selling the home:


Home Sells for $750,000
Less Original Basis* ($200,000)
Less Capital Gain Exclusion ($500,000)
Gain on Sale $50,000
Capital Gains Tax at 15% $7500 (Owed by homeowner)


*This is the original basis or price of home $300,000, less the $100,000 debt cancellation from the lender.


While $7500 capital gains tax is surely a lot less than the $100,000 cancelled by the lender, the homeowner may not think of this or be aware it could happen down the road, perhaps just prior to retirement. And capital gains taxes are always subject to change.


It gets a bit more complicated when one spouse dies and the other is left to sell the home. Consult your tax accountant or attorney for planning purposes.


Mortgage Insurance Affected


It is important to also note that this act extended mortgage insurance as an itemized deduction all the way through 2010. Yes, there’s a restriction. The mortgage contract has to be entered into between December 31, 2006 and January 1, 2011.


Housing Market Stabilization


All of this is being done in an effort to stabilize our housing market and should help many homeowners in these situations. Always consult with a professional tax accountant or attorney to be sure you are taking the right road to solving your mortgage crisis and will be covered under this new tax relief act.


Please contact your CPA or tax advisor with any questions.  Please contact me today if you are in a situation that will require the short sale of your property.  I am always here to help!


Jenn Woolley
(602) 510-5554
Professional Real Estate Consultant
Keller Williams Integrity First Realty

Credit Issues? Your Lender Can Help!

Credit Issues?  Your Lender Can Help!


We frequently hear we’re supposed to regularly check our credit reports. And staying on top of this is especially important when starting to shop for a new home. There are three main credit bureaus: Equifax, Experian, and TransUnion. These bureaus store consumer credit histories by the millions, and hundreds of thousands of businesses tap these bureaus for their data about you. Unfortunately, mistakes can happen. Especially if you’re not the only “Bob Johnson” or “Susan Smith” who lives in St. Louis. 


Let’s say you receive a copy of your credit report and find a mistake—what do you do?  What if there’s an old collection account showing as unpaid when you have the paid receipt and a letter stating that the account has been settled?


Your credit report will show which of the three credit bureaus are reporting the error, and you’ll get a toll-free number to call.  But if you have ever called one of these numbers, you know to expect anything but friendly service. You know the drill, “Press 1 for English, Press 2 if you are a consumer, Press 3 if you’d like to enroll in our…” and so on.  It’s likely you’ll either leave a voicemail or listen to some sales pitch for a credit protection service. But all you want is to get your credit fixed so you can clean up your report.


You’ll be asked to fax your documentation, fill out some forms and then wait for the bureau to fix the report and update your file. This can take time, sometimes weeks. Luckily, there is an easier way: let your loan officer handle it for you.


That’s right. You can give that very same documentation to your loan officer and they can  have the offending item removed from your credit report in minutes. How can they do it so quickly?


Mortgage lenders use credit reporting agencies. Often. And those same agencies hire customer service representatives to make sales calls to all those mortgage companies.  One of their services allows the lender to provide the corrected documentation showing the collection account as having been paid to the credit agency, who will then update the credit report almost immediately. What once showed up as an “unpaid” collection account now rightly shows as “paid.” It’s that easy.


It’s important to regularly check your credit, and if you do find yourself in a situation where your credit report has an error on it, don’t go to the bureaus directly. Instead, take advantage of the relationship your lender has with the credit agencies. Your mortgage specialist can fix things much quicker than you can.


Written by David Reed, author of Mortgage 101 and Mortgage Confidential.

The Truth About Appraisals

The Truth About Appraisals
Knowing the Guidelines Solves the Mystery

The appraisal process often baffles consumers. They may feel that their home is worth a higher dollar amount, and so the appraised value doesn’t always make sense to them. It is important to know that the appraiser is completely independent from lenders, buyers, sellers, and real estate agents, and that the guidelines to which they adhere are dictated by the Uniform Standards of Professional Appraisal Practice (USPAP) and Fannie Mae. In most states, the mortgage lenders must also disclose the purpose of the appraisal, as each transaction carries its own set of rules.
In essence, these important guidelines help appraisers put a fair market value on homes based on comparable sales in the same area, and the home must be bracketed in size and value.


For example, there is no set dollar figure associated with a great view, pool, spa, bathroom upgrades, etc. If a homeowner installs a custom pool that cost them $30,000, but the local marketplace supports the value of a pool at $15,000, then that item will be bracketed as [$15,000] on the appraisal.


Upgrades can usually be expressed at a higher percentage of their value in newer homes because the only way to obtain those upgrades was to put more money into the cost of building the home. On the other hand, the upgrading or remodeling of an older home is rarely reflected in full in the final appraisal. This is because typically 25-40% of the project involves demolition and the fixing of issues that aren’t uncovered until the project has already begun, such as plumbing or wiring that may need updating.


Ultimately, the value of the upgrades must be supported by comparable examples within the same marketplace. These comparisons must be drawn from current market activity within the last six months. This is a safeguard to prevent appraisers from attaching too high a value to the home in question, and opening up the appraisal for review. This guideline further states that appraisers can only base their opinion on the value of home sales that have actually closed.



Please call with any questions any time!





Jenn Woolley
(602) 510-5554
Professional Real Estate Consultant
Keller Williams Integrity First Realty



Principal Balance Reduction Program


We are here to give you a new start on your current mortgage situation and genuinely want to help!

In todays real estate market many homeowners are facing difficult challenges. They are either ‘upside down’ and owe more than what their home is worth, are having a hard time making their mortgage payments, or maybe even facing foreclosure.  If you are facing any of these stressful situations, we can advise you on your options!

The “Balance Reduction Program” has the ability to keep you in your home and reduce your current loan balance to 95% of today’s current market value.

Here’s How It Works

Your mortgage note will be negotiated along with other homeowners’ notes issued by your lender.  A price is negotiated for an investor to pay them all off for cash, at a deep discount to the current market value.

Once your note is paid off, the terms of your note are rewritten based on 95% of your home’s current market value eliminating any “negative equity” and actually giving you 5% instant equity!

Here is an example: You owe $300K on your home but it is only worth $200k. The investor pays off the note (they do not own the deed to your home) and establishes new terms with a new mortgage balance of $190k, saving you $110k!

A short payoff of your second mortgage (if you have one) is also negotiated once the investor owns your note

The New Note

The new terms of the note will be for 95% of the market value of the home at the time the note is purchased from the lender.
– Interest rate will be Prime + 4% if your FICO score is under 700 and Prime + 3% if your score is 700 or above.
– The loan is amortized over 30 years.

In some cases, there may be a 3 year pre-payment penalty which amounts to 6-months of interest payments.

For performing notes where you do not have more than 1 late in the last 12 months, you have the option of refinancing the property into a conventional loan program. The above note terms are subject to change due to market conditions and/or changes that negatively impact your current financial or mortgage status.

Qualification Requirements

All types of credit will qualify. You can be “upside down”, behind in your mortgage payments, or even in foreclosure (except NV).  It doesn’t matter if you have received a notice of default or trustee sale. Financial Link does not act or consult where the client has a foreclosure in progress in the state of Nevada.

– You must owe more than your home is worth.
– You must have monthly income with no more than 50% debt to income ratio.

How Long Will the Process Take?

Expect between 60 to 90 days from receipt of complete documents and it can be longer depending on your bank.

How is this different than a Loan Modification?

An investor pays off the balance on your mortgage note (and your 2nd if there is one).  The investor who pays off the note agrees to rewrite new terms on the note based on 95% of the current market value of your home.  This is not a “modification” of your loan that only results in a payment reduction and not a reduction in your principal balance.  The negotiators do not work with the loss mitigation, customer service or collections departments at your bank to “modify” your loan.  They work with the Asset and Wealth Management department to purchase your note along with others.  It is a completely different side of the bank with a completely different outcome.  Depending on your lender a loan modification may have tax and credit implications.

Why Would My Bank Do This?

The Asset and Wealth Management department packages groups of notes together and sells them for cash with which to encourage further lending.  Banks are highly motivated to get non-performing notes (assets) off of their books because The Federal Reserve penalizes banks for holding onto non-performing assets.  When notes are negotiated in large packages, our negotiators have more leverage, especially since we are offering large sums of cash.  This requires an investor to purchase the group of notes once a settlement has been negotiated.

What is the downside?

The lender may not accept the offer from the investor or you may not qualify for a new loan.  In this case, we have other programs to get you the best solution available.

Do you stop Trustee Sales?

We do NOT stop Trustee Sales.  It is your responsibility to make sure you have the proper legal representation to prevent your home from going to foreclosure.  We can recommend a service or attorney if you request it in a timely manner.

Our goal is solely to assist homeowners.

We’re here to help you resolve your current situation so you can stay in your home and have an affordable mortgage.  We do not want to own your home or take advantage of your difficult circumstances. We are real estate professionals who understand the mortgage industry from years of experience.  We have many options available to help you through this process!

How much does this cost?

Please give me a call today for your FREE, No Obligation consultation.  I look forward to helping you, your friends and your family out of their difficult situations.  We are here to give you a new start on your current mortgage situation and genuinely want to help.


Jenn Woolley
(602) 510-5554
Professional Real Estate Consultant
Keller Williams Integrity First Realty