Commercial Loan Corporation is a California Private Money Lender that specializes in loans to irrevocable trusts. Due to the complexity and risks associated with lending to trusts, most lenders will not provide this type of finance. Loans to irrevocable trusts is our primary business focus.
If you are a trust administrator and require a trust loan to provide the cash needed for an equal trust distribution, please call us. Our specialized irrevocable trust loans can help provide the liquidity needed to allow for an equal distribution. Our loans can help a beneficiary who is inheriting real estate qualify for a California Prop 58 exclusion from property tax reassessment. Taking advantage of the Proposition 58 property tax reassessment exclusion can save potentially several thousands of dollars a year in property taxes.
If you are interested in receiving a loan for an irrevocable trust or have questions on the trust loan process, please call us at 877-464-1066. We can help you determine if a trust loan is right for your situation and if you may qualify for Proposition 58.
California Proposition 58 Parent to Child Property Tax Transfer
California Proposition 58 and Property Taxes
When inheriting real estate from a parent, one of the primary considerations in determining if you will keep or sell the property is often the expenses associated with the home. Typically one of the greatest expenses is the homes property taxes. In California, Proposition 58 grants qualifying children the ability to retain a parents low Proposition 13 protected property tax rate. Doing so could mean a savings of thousands of dollars each year. Commercial Loan Corporation helps beneficiaries and heirs qualify for their Prop 58 property tax benefits by providing bridge loans to trusts and probate estates so that an even distribution can be made.
Information About Proposition 58
In 1986, California’s Proposition 58 became effective and with certain limitations, it allows for the exclusion from reassessment of property taxes on real estate transfers between a parent and child. In the State of California, real estate is reassessed at market value if it the home is either sold or transferred. The property value reassessment may cause property taxes to increase dramatically in some cases. Preventing a property tax reassessment may save a beneficiary or heir thousands of dollars annually depending on the difference between the existing assessed value and the current reassessed property value. If the transfer of property is between a parent and child, under certain circumstances the property will not be reassessed if all required conditions are met. If applicable, an equal distribution must be made to all beneficiaries and a beneficiary is not permitted to contribute personal funds to equalize the distribution to qualify for an exclusion from property tax reassessment. An application must also be properly filed in a appropriate amount of time to be eligible for a Proposition 58 exclusion from property tax reassessment. When done properly, the new owner’s taxes are calculated on the parents established Proposition 13 factored base year value, instead of the current market value.
California Proposition 58 Limitations
There are some limitations to Proposition 58. For instance, on non primary residences transfers of the first $1 million of real property. The $1 million exclusion applies separately to each eligible transferor. These transfers may be result of a sale, gift, or inheritance. A transfer via a trust also qualifies for this exclusion. Additionally, when applicable an equal distribution must be made to all beneficiaries and a beneficiary is not permitted to contribute personal funds to equalize a trust distribution. In the situation where fund are needed to make an equal distribution, a third party loan is required. That is where Commercial Loan Corporation can assist you by providing a bridge loan to the trust or estate. The Commercial Loan Corporation third party bridge loan provides enough cash to the trust or estate so that all parties can receive an equal portion of the trust or estate assets and enables one or more of the beneficiaries to receive the home as their portion of the distribution.
Additionally, Prop 58 defines a child as child born of the parent(s), a stepchild while the relationship of stepparent and stepchild exists, a son-in-law or daughter-in-law of the parent(s), and any adopted child who was adopted before the age of 18. Spouses of eligible children are also eligible until divorce or, if terminated by death, until the remarriage of the surviving spouse, stepparent, or parent-in-law. Information found at https://trustandestate.loans
California Proposition 193
California Proposition 193 grants the same rights to a grandchild as Proposition 58 grants to a child. An eligible “grandchild” for purposes of Proposition 193 is any child of parent(s) who qualify as child(ren) of the grandparents as of the date of transfer.
There are some additional requirements and exclusions for Proposition 58 and Proposition 193. Please call us at 877-464-1066 so that we can assist you.
When it comes to choosing a California Private Money Lender or California Hard Money Lender, you have a handful of options to choose from. Selecting the right one might be more important than you think.
Interest Rates, Penalties & Fees
For instance, choosing the best private mortgage lender can have a significant impact on your pocketbook. Lenders make money on a loan in a few different ways. The most common ways are through fees, interest rate premiums and penalties. One of the most important things that separates Commercial Loan Corporation from other California Private Money Lenders is that we do not charge any form of prepayment penalties, we offer competitive fees and have some of the lowest interest rates in the hard money lending marketplace. Prepayment penalties alone can cost a borrower potentially tens of thousands of dollars or even worse, trap them in a high interest rate loan that they no longer want or need!
Another important factor to consider when selecting the right private money lender is customer service. We are aware, that in this day and age, the phrase “Customer Service” almost sounds sarcastic. At Commercial Loan Corporation you are more than just a loan number. We might be a relatively small private money lender, but we are big on the customer experience. Regardless of your loan amount, you will always be treated with respect and courtesy by every member of our team. It is a sincere goal of ours to provide you with the fastest and best mortgage transaction that you have ever experienced. In many cases, we can fund a private money loan to a trust or estate in as little as 7 days. Please view some of our recent customer testimonials located here.
As you may be aware, in some situations California Proposition 58 grants residents the ability to transfer Real Estate along with a Proposition 13 protected property tax base from a parent to child. Sometimes in order to qualify for this exclusion against reassessment of property taxes, the beneficiary or heir may require a private money bridge loan or hard money loan. When it comes to Trust & Estate Bridge Loans and Third Party Private Money Loans to Trusts and Estates, experience with these types of loans is critical. The truth is that most California hard money lenders either never or rarely lend money to a trust or estate for Proposition 58 tax benefit purposes. If the financing is not conducted properly, the County Tax Assessors office is likely to reject the borrowers requests for a property tax reassessment exclusion. Even a small mistake could mean missing out on possibly thousands of dollars annually in property tax savings. At Commercial Loan Corporation, we specializes in providing short term financing and bridge loans to help our clients obtain Proposition 58 property tax reassessment exclusions. Every member of the Commercial Loan Corporation team has at least 15 years of mortgage experience and combined, our team has over 90 years of mortgage experience.