Trust Loans

Trust Loans

Trust Loans in California

What are Trust Loans?

Trust Loans or Loans to Trusts are loans made directly to a trust as opposed to an individual. With a conventional mortgage, a borrower applies for a loan and signs the loan documents personally guaranteeing the loan. With a trust loan it works a little different. Instead of a borrower guaranteeing the loan, the Successor Trustee will sign loan documents on behalf of the trust and the lender lends to the trust as opposed to a person. With a trust, usually a home is used as the collateral for the trust mortgage or trust loan. Often times there is no credit check, income verification or personal guarantee involved with a trust loan.

What is the purpose of a Trust Loan?

Most of the trust loans that we provide are to prepare a trust for distribution so that one of the trust beneficiaries can avoid property tax reassessment on an inherited home. California is one of the few states that provides a property tax security measure which prevents property taxes from increasing too rapidly. In California, Proposition 13 is what achieves this. California Proposition 13 caps the maximum increase of the assessed value of a home at 2% annually. This means that over a 10 year period, if your home doubled in value from $400,000 to $800,0000; you would only be paying property taxes on an assessed value of approximately $487,500 as opposed to the current market value of $800,000. In California, the typically property tax rate is 1% of the assessed value. So in the example above, it would mean an annual property tax savings of $3,125.

California Proposition 13 has been in effect since 1978. As you can imagine, since 1978 property values have increase significantly and Proposition 13 has kept the assessed values of many homes extremely low. In addition to preventing property taxes from increasing too rapidly, California has other laws to protect residents. Proposition 19, allows a parent to transfer a home to a child and avoid reassessment on that home if it is a primary residence. This is where a trust loan becomes very important. California Proposition 19 has specific requirements that must be met if a person inherits a home from a parent and wishes to avoid property tax reassessment on that home. One of those requirements pertains to trusts and estates. The California Board of Equalization requires that an equal distribution of assets be made to all child beneficiaries unless specific language exists in the trust. Information on this can be viewed here on the California Board of Equalization website When a trust is involved, a trust loan is likely the only way to accomplish an equal distribution.

Often times when a trust contains real estate, the home is by far the most valuable asset in the trust. When there are multiple beneficiaries in the trust, that often time means an equal distribution can not be made without cash being added to the trust. The trust loan resolves this issue by injecting cash into the trust while at the same time placing a lien or debt against the real estate. This allows for one child to inherit the home while other children receive an equal amount of cash, creating an equal distribution. Since the loan is made to the trust as opposed to the beneficiary, the child inheriting the home can qualify for the Proposition 19 exclusion from property tax reassessment. On average our clients save $6,500 a year in property taxes by avoiding property reassessment.

If you are inheriting a home and are interested in keeping a parents low property tax base, we may be able to help. We have assisted over 450 clients in avoiding property tax reassessment. We work with Trust & Estate Attorneys and Property Tax Consultants across California. Call us at (877)464-1066 and we can provide you with a FREE Trust Loan Benefit Analysis that will let you know if you may be eligible to avoid property tax reassessment and how much in annual property taxes a trust loan may help you save.

Lending for Probate Estates & Irrevocable Trusts in California

Loans to Probate Estates and Irrevocable Trusts

Loans to Probate Estates and Irrevocable Trusts

Finding financing for Probate Estates and Irrevocable Trusts in California can be complicated. Most lenders are unwilling to lend on a property until the estate has been settled. The same problems exist for real estate held in an Irrevocable trust; conventional lenders will require the home be removed from the trust in order to provide financing and doing so is likely to jeopardize your ability to take advantage of the Proposition 19 parent to child transfer exclusion. Our private money loans help solve these complex issues. We lend to probate estates and directly to irrevocable trusts, providing the cash needed for trust administrators and beneficiaries to keep a family home and transfer a parents low property tax base.

We are California’s top Trust & Estate lender and have saved Californian’s over $7,800,000 in property taxes by avoiding property reassessment. We specialize in providing clients with the financing needed to qualify for California Proposition 19’s parent to child property tax transfer. Our average client saves over $6,800 each year in property taxes and if you are inheriting a home from a parent, we may be able to assist you as well. We offer competitive rates, have no personal guarantee requirements, offer affordable interest only payments with absolutely no no prepay penalties or minimum interest requirements.  We are here to help!

Call us at (877) 464-1066 and we can assist you or your client with a loan to a probate estate or irrevocable trust. We will help you determine your property tax savings, provide you with a free cost benefit analysis and answer any questions you may have on the process.

 

Irrevocable Trust Loans

Lender for Irrevocable Trusts

California Lender for loans to Irrevocable Trusts

Loans to Irrevocable Trusts

When it comes time to distribute the assets of an irrevocable trust, a trust loan may be needed if an equal distribution is required or desired. A trust loan provides the trust with liquidity; supplying cash so that assets do not need to be sold off or converted to cash. The trust loan is a mortgage placed against a piece of real estate held in the trust. Unlike a traditional mortgage, a trust mortgage loan is typically a short term loan. Once the assets of the trust are distributed, the beneficiary who inherited the real estate with the trust mortgage placed on it would refinance the trust mortgage with a conventional mortgage or payoff the mortgage.

Why Is An Equal Distribution Important?

When it comes to a trust distribution, an equal distribution can be important for a variety of reasons. Often times there is language in the trust that requires an equal distribution of the assets in the trust be made to beneficiaries. If the trust only contained cash, it would be easy to accomplish this. Unfortunately, most trusts that contain real estate do not have cash or other assets sufficient to create an equal distribution. In this situation, either the real estate must be sold or a mortgage must be taken out on the real estate to infuse the trust with cash. A trust loan is almost always the least expensive of the two options. Sometimes, more importantly, it also allows a beneficiary to keep a family home in the family.

Another important reason for the equal distribution of a trust is to meet the requirements of California Proposition 58. Prop 58 allows a child who is inheriting a home from a parent to avoid property tax reassessment on that home. This passes the low proposition 13 protected tax base from a parent to a child. Often times when the home is held in a trust, an equal distribution is required if a Proposition 58 exclusion from reassessment is to be granted by the County Tax Assessors office. In fact, the majority of trust loans that we provide are specifically for this reason. Our clients save on average over six thousand dollars per year in property tax savings by avoiding reassessment.

Do All Lenders Loan To Irrevocable Trusts?

No, in fact very few lenders are willing to lend to a trust, let alone an irrevocable trust. Typically when a home is held in a trust, a conventional lender will require that the property first be removed from the trust before they will lend on it. When a trust is revocable, this may not be an issue since the home can be added back into to trust once the mortgage process has been completed. Once the trust becomes irrevocable, often times the ability to do so is no longer possible and a lender who can lend to Irrevocable Trusts will be required.

When the requirements of Proposition 58 need to be considered, the situation can become even more complicated. Proposition 58 requires that the acquiring beneficiary of the real estate makes no personal guarantee on the trust loan or trust mortgage.  Doing so would be perceived as a sibling to sibling transfer of real estate as opposed to a parent to child transfer and would likely jeopardize the exclusion from property reassessment. Commercial Loan Corporation is one of the only lenders in California that provides Irrevocable Trust Loans with no personal guarantee requirements. We work directly with Trust Administrators, Trustees, Beneficiaries, Attorneys and Property Tax Consultants. If you require a Trust & Estate Attorney or Property Tax Consultant to assist you with Proposition 58, we can refer you to an expert to assist you.

Is A Trust Loan Less Expensive Than Selling A Home?

Yes, in almost all cases a trust loan is far less expensive than selling a home. Additionally a trust loan takes less time to complete than it takes to sell a home. We can complete a trust loan in as little as 10 business days. That means beneficiaries can get more money and get their funds more quickly. When you consider the ability to take advantage of the Proposition 58’s exclusion from reassessment, the savings grow even further.

We specialize in loans to Irrevocable Trusts. If you or a client are in need of a trust loan or have questions about loans to an irrevocable trust, please call us at 877-464-1066. We will provide you with a free benefit analysis and answer any question you may have.

Irrevocable Trust Loan Specialist

Your California Irrevocable Trust Loan Specialist

Trust Loan Specialist

California Trust Loan Specialist

Commercial Loan Corporation is a licensed California lender specializing in making loans to trusts and estates. Unlike most lenders who provide a broad range of loans, we focus specifically on trusts, irrevocable trusts and estates. In fact every month we help clients by providing trust loans so that an equal distribution of assets can be made. Our trust loans help beneficiaries meet the requirements of California Proposition 58 and help them to avoid property tax reassessment on an inherited home.On average we save our clients over $6,000 per year in property taxes by helping them avoid property tax reassessment.When receiving a trust loan from Commercial Loan Corporation, you can count on:

  • An simplified application process
  • Quick Approvals and Fast Funding
  • Our Loans Fund In As Little As 7-Days
  • Same Day Loan Approvals
  • The Highest Level of Customer Service

If you, a family member, client or friend may be able to benefit from a trust loan, please call us at 877-464-1066. We provide clients with a no cost estimate on how much might be saved by taking advantage of California Proposition 58’s exclusion from property tax reassessment.

Loans to Irrevocable Trusts

Most banks and lenders are not willing to lend on a property that is held in an Irrevocable Trust. Instead they require that the property be removed from the trust before placing a mortgage upon it. This can make it difficult if not impossible for a beneficiary to qualify for Proposition 58. If you are trying to preserve a parents low Proposition 13 property tax base on an inherited property that is held in a trust, call us at 877-464-1066 and we can help you simplify what can be a complicated process.

Loans to Trusts and Beneficiaries

Loans to Trusts and Beneficiaries

Click here for more information on Trust Loans

California Proposition 58 – Avoiding a sibling to sibling buyout

 

California Proposition 58 Qualifications

California Proposition 58 Qualifications

Qualifying for California Proposition 58’s Parent to Child Transfer

When it comes to California Proposition 58, making a mistake can cost you! Prop 58 grants the ability for a parent to transfer real estate to a child and avoid having that property reassessed. That may sound insignificant to some, but it can translate to a dramatic yearly property tax savings. In fact, the clients we assist save on average more that $6,000 per year in property taxes by taking advantage of this Proposition 58 property tax benefit.

In order for a child who is inheriting a home from a parent to qualify for Proposition 58, they must meet specific requirements. One of these requirements is that when there are multiple child beneficiaries involved and one of the children wants to inherit the home, while others wish to receive cash; the child inheriting the home can not use their own funds or personally guarantee the funds used to equalize the distribution. That is where Commercial Loan Corporation can help. Unlike conventional lenders, we provide loans directly to a trust; even an irrevocable trust. This allows our clients to avoid a sibling to sibling buyout which would otherwise disqualify them from receiving a full exclusion from property tax reassessment.

We highly recommend that you work with an attorney or property tax specialist to insure you both qualify and receive your benefit. Call us at 877-464-1066 and we can provide you with a FREE analysis of how much you might be able to save each year in property taxes. We can also put you in contact with a qualified Attorney or California Property Tax Consultant in your area if you require assistance.

CALL 877-464-1066

California Proposition 58 Qualifications

California Estate Loan And Trust Loan Provider

Estate Loans and Third Party Loans To Trusts - Call Commercial Loan Corporation at 877-464-1066

Estate Loans and Third Party Loans To Trusts – Call 877-464-1066 For Assistance

Provider Of California Estate Loans

Thanks to California Proposition 58, a parent is permitted to transfer their low property tax rate to a child on an inherited piece of real estate. Unfortunately, in some situations receiving an exclusion from property tax reassessment can be easier said than done. Specific steps must be taken to receive your exclusion from your local County Tax Assessors Office and if they are not done correctly, you may lose your ability to preserve your parents low property tax rate. Commercial Loan Corporation specializes in providing loans to estates and trusts. These specialty private money mortgages assist our clients in qualifying for the Prop 58 property tax exclusion from reassessment. In addition to providing third party private money trust and estate mortgages, we can also put you in contact with a qualified estate attorney, probate attorney, fiduciary or California property tax consultant to assist you in qualifying for your Proposition 58 benefits.If you need an estate or trust loan, or have questions, please call us at 877-464-1066 or complete our information request form located here.

Proposition 58 Exclusion From Property Tax Reassessment

In 1986 California enacted Proposition 58. Proposition 58 allows for an inheriting property owner to avoid a property tax reassessment when acquiring real estate from their parents. The inheriting owner’s property taxes are calculated on the established Proposition 13 factored value, instead of the current market value, saving them potentially thousands of dollars annually. This is especially important if one of the children inheriting the property wants to either keep the home as a residence or as an investment property. If the parent has owned the home for an extended period of time, there is a high probability that Prop 13 has kept their property tax rate much lower than it would be if the property was reassessed at current market value.

Under Proposition 58, retaining a parents low property tax rate can become complicated when there is not enough liquid assets in the trust or estate to create an equal distribution to all siblings. In this situation a third party loan placed against the inherited home may be the only option to make an equal distribution. The additional cash made available from our 3rd party loan allows each of the siblings to receive an equal share of the assets. If the third party loan is not handled properly, the County Assessors Office may reject your request for a Proposition 58 exclusion from property tax reassessment and the property taxes will be calculated on the homes current assessed value. If you, one of your siblings or a client of yours is in need of a third party loan to take advantage of California Proposition 58’s exclusion from property tax reassessment, call Us at 877-464-1066.  We specialize in providing private money loans to trusts and estates and can assist you.