Happy Memorial Day

memorial day

This Memorial Day, please set aside some time to observe a moment of silence in honor of our heroes and heroines who sacrificed or risked their lives for our country and our freedom.  We, your business partners at WRT, wish you and your families a very safe and enjoyable Memorial Holiday weekend.

 

Please be advised that our office, as well as ALL County Recorders offices will be closed on Monday, May 30th, 2016 in observance of this federal holiday!
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Do I need to Homestead my property?

CFPB

In a distressed housing market, it is natural for homeowners to question the security of their homeownership. Attached is an informative piece on how a homestead declaration operates in the state of California.It is important to remember that a homestead provision offers homeowners only limited protection from a forced sale to satisfy certain debts.  As always, we kindly recommended you direct all legal/debt questions to the proper professional.

CA Prop 60/90: The Tax Breaks for Seniors

These two constitutional amendments, passed by California voters provide property tax relief for persons aged 55 and over.  Implemented by section 69.5 of the Revenue and Taxation Code, they allow these persons, under certain conditions, to transfer a property’s factored base year value from an existing residence to a replacement residence.

Important to note about these two tax transfer initiatives is that Proposition 60 allows transfers of base year values within the same county (intracounty), while Proposition 90 allows transfers from one county to another county in California (intercounty) and it is the discretion of each county to authorize such transfers.

In the link below please find a WRT marketing piece on these propositions.  For more technical answers to your questions, here’s the FAQ’s link as found on the California State Board of Equalization website: PROP 60/90

Click here for WRT Proposition 60 /90 Handout

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Transfer On Death Deed (Assembly Bill 139)

A new California law took effect this year that allows the use of transfer on death (RTD) deeds for real property. A RTD deed is a revocable beneficiary deed, involving the gift of an individual’s residence, which does not become a completed transfer until the death of the
transferor. It is limited to multi-unit properties with one to four dwelling units, condominiums and single family residences (with fewer than 40 acres of agriculture land).

Click here for more information and here to download the blank deed with a Q&A.

California Homeowner’s Exemption Vs. California Homestead Exemption

What Is The Difference?

Homeowner’s Exemption

Screen Shot 2015-05-14 at 10.58.27 PMA homeowner’s exemption is just a property tax exemption.  The California state constitution provides for the exemption of up to $7,000 in assessed value from property tax assessment of any property owned and occupied as the owner’s principal place of residence.  This means that the exemption removes up to $70 from your annual property tax bill. This may not seem like much, but it’s easy to obtain, and it adds up!  There’s no reason to forgo the benefit.

In order to qualify for the exemption for property, you must be its owner or co-owner, and must use the property as your principle place of residence (Vacation homes don’t count!).  Any place you own as your principle place of residence, and that is also subject to property tax, qualifies.  You also have to file an exemption claim form with the County Assessor.  Luckily, once the exemption has been granted, you won’t need to re-file the claim unless the title on the deed to the property changes.

There is one catch: if you plan to refinance your home, or plan to move your home out of (or into) a living trust, note that doing so may require you to change the title on the deed to the property.  Each time you do so, you will have to re-file your exemption claim, to ensure that you continue to receive the exemption.

Homestead Exemption



A homestead exemption, on the other hand, is an entirely different (and slightly more complicated) animal.  It is a bankruptcy exemption intended to help protect people from losing their homes to creditors.  If someone is sued for money and loses, the creditor can satisfy the amount of the judgment (translation: ensure they get paid) by selling assets belonging to the debtor, including the debtor’s home.  The California homestead exemption protects the homeowner’s equity up to the amount of the exemption even if the home is sold.  The point is to ensure that debtors and their families have some money remaining to invest in a new home, should their current home be sold involuntarily.  The exemption applies to every person who lives in a dwelling; the dwelling can be a home, trailer, mobile home, boat, etc.

Click here for more details regarding Homestead Protection.

In 2015 purchase price cannot be kept a secret!

New law, Assembly Bill 1888, repeals the right of a principal to demand that the transfer tax be shown on a separate piece of paper. This law comes into effect on January 1, 2015.  Previously, a seller or buyer of real property could demand from the county that the documentary transfer tax (the DTT) be stated apart from the recorded document.  This enabled some principals to effectively keep the purchase price secret, since the amount of the transfer tax can be reliably used to deduce the purchase price. (Although the information could be obtained through a California Public Records Act request.) Now every document subject to the DTT when it is submitted for recordation must show on its face the amount of the tax due. These rules have little impact on listings input into an MLS since MLS Model Rules require the reporting of the selling price within two days after the final closing.

In this link please find an explanation of Documentary Transfer Tax and the Southern California counties Transfer Tax Rates.

Probate Basics

legalProbate, which stems from the classic Latin term meaning “to prove” or “proven”, is the legal process of administering the estate of a deceased person by resolving all claims and distributing the deceased person’s property either under a valid will or when the decedent has died intestate (without a will) to their heirs and beneficiaries.

Probate is also the process by which the property of a decedent is re-titled.  As with any legal proceeding, there are technical aspects to probate and trust administration.

Here are just a few:

  • Creditors need to be notified and legal notices published.
  • Trustees need to be guided in how and when to distribute assets and how to take creditors’ rights into account.
  • A Petition to appoint a personal representative (executor/administrator) may need to be filed and Letters of Administration obtained.
  • If the estate is not automatically devised to a surviving spouse through joint tenancy or is not held within a trust, the estate will need to be probated whether or not the decedent had a valid will.

Please note that this is just a brief and informative overview of what can be a very lengthy and involved probate process.  Embedded in this newsletter please find a more in-depth information regarding the probate process as published by the CLTA – UNDERSTANDING PROBATE 



Most important to remember is that probate and trust administration laws vary from state to state.  For answers to your technical probate questions, please consult the proper professional.

 

Southland Home Sales Stuck at 6-year Low; Median Price Rises to 6-Year High

As seen on DQNEWS.com

La Jolla, CA—Southern California home sales quickened last month compared with February, as they normally do, but remained far below average and at the lowest level for a March in six years. The median sale price rose to a more-than-six-year high, driven up by demand that continues to exceed supply in many areas, as well as a shift toward a greater share of sales in middle and high-end markets, a real estate information service reported.

A total of 17,638 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was up 25.7 percent from 14,027 sales in February, and down 14.3 percent from 20,581 sales in March last year, according to San Diego-based DataQuick.

For seasonal reasons sales shoot up between February and March, with that gain averaging 36.3 percent since 1988, when DataQuick’s statistics begin. Southland sales have fallen on a year-over-year basis for six consecutive months, and last month was the second in a row in which sales were at the lowest level for that particular month in six years.

Sales during the month of March have ranged from a low of 12,808 in 2008 to a high of 37,030 in 2004. Last month’s sales were 26.9 percent below the average number of sales – 24,115 – for March since 1988. Sales haven’t been above average for any month in more than seven years.

“Southland home buying got off to a very slow start this year, with last month’s sales coming in at the second-lowest level for a March in nearly two decades. We see multiple reasons for this: The inventory of homes for sale remains thin in many markets. Investor purchases have fallen. The jump in home prices and mortgage rates over the past year has priced some people out of the market, while other would-be buyers struggle with credit hurdles. Also, some potential move-up buyers are holding back while they weigh whether to abandon a phenomenally low interest rate on their current mortgage in order to buy a different home,” said DataQuick analyst Andrew LePage.

For entire article please click here.

Understanding Supplemental Property Taxes

Supplemental property taxes have been with us since 1983, but you and your neighbors still may not know what they are, what they do and how they affect you and your property. To help you better understand this confusing subject, here are the answers to some of the most frequently asked questions about supplemental real property taxes.

When did this tax take effect?

The Supplemental Real Property Tax Law was signed by the Governor in July of 1983 and is part of an ambitious drive to aid California’s schools. This property tax revision is expected to produce over $300 million per year in revenue for schools.

How will Supplemental Taxes affect me?

If you buy a new property or undertake new construction you will be required to pay a supplemental property tax which will become a lien against your property as of the date of ownership change or the date of completion of new construction.

When and how will I be billed?

“When” is not easy to predict. You could be billed in as few as three weeks, or it could takeover six months. When will depend on the individual county.  The assessor will appraise your property and advise you of the new supplemental assessment amount. At that time you will have the opportunity to discuss your evaluation, apply for a Homeowner’s Exemption and be informed of your right to file an Assessment Appeal. The county will then calculate the amount of the supplemental tax bill. The supplemental tax bill will identify, among other things, the amount of the supplemental tax and the date on which the taxes will become delinquent.

How will the amount of my bill be determined?

There is a formula used to determine your tax bill. The total supplemental assessment will be prorated based on the number of months remaining until the end of the tax year, June 30th.

Will my taxes be prorated in escrow?

No. Unlike your ordinary annual taxes, the supplemental tax is a one time tax which dates from the date you take ownership of your property or complete the construction until the end of the tax year June 30th.

To download handout, click here.

Property Taxes are Due December 10th

IMPORTANT REMINDER… and great reason to call your past clients to remind them that their property taxes are due!

 Click below to pay online:

Los Angeles County  –  Orange County  –  Riverside County

San Bernardino County  –  San Diego County