Irrevocable Trust Loans

Lending to an Irrevocable Trust

Lending to an Irrevocable Trust

Commercial Loan Corporation is one of only a few California lenders that will lend directly to an irrevocable trust. So what is an irrevocable trust?

An irrevocable trust is a type of trust where its terms cannot be modified, amended or terminated under most conditions. Often times, an irrevocable trust will begin as a living trust and once the grantor passes, will turn into an irrevocable trust. An irrevocable trust designates a trustee and beneficiary(s). The trustee is the person who manages the trust and may also be one of the beneficiaries. An irrevocable trust is commonly used to pass assets to heirs while avoiding probate. When you transfer your assets into an irrevocable trust, you relinquish control of those assets. The trust becomes the owner of the assets at that point.

The reason why most lenders will not lend directly to an irrevocable trust is because the trust is the owner of the assets, as opposed to an individual. This become important when a child is inheriting a home from a parent and would like to use Prop 58, or Prop 19 to keep a parents low property tax base. The California Board of Equalization requires and equal distribution of assets be made when multiple beneficiaries are involved unless specific conditions are met. If there are not sufficient cash assets in the trust to make an equal distribution, then a loan against real estate in the trust will be needed to qualify for the parent to child transfer to avoid property tax reassessment.

That is where Commercial Loan Corporation comes into play. We specialize in lending to trusts and estates; specifically irrevocable trusts.  Our trust loans, allow one child to keep an inherited home with the parents low Prop 13 tax base in tact, while the other child beneficiaries receive an equal portion of cash. Everybody wins! By avoiding expensive realtor fees, each beneficiary on average receives and additional $15,000 in inheritance and the child keeping the family home saves on average $6,200 per year in property taxes.

If you, a family member or a client may be able to benefit from a trust loan, we are here to assist you and answer any questions you might have.  Please call us at 877-464-1066.

Trust & Estate Loan Benefit Calculator

Trust and Estate Loan Benefit Calculator

Trust and Estate Loan Benefit Calculator

Trust & Estate Loan Calculator

Are you are considering taking out a third party loan in order to equalize a trust or estate distribution and take advantage of California’s Proposition 58’s exclusion for Property Tax Reassessment? The act of doing so has saved some of our clients thousands of dollars annually and in most situations it makes sense to do so if you plan on keeping the home for more than just a few years. To make sure that the loan is financially beneficial, it is important to compare the costs of the loan with the expected property tax savings. At Commercial Loan Corporation we do not want to provide a loan to a client if it is not in their best interest and that is why we have created the Trust & Estate Loan Benefit Calculator.

Our easy to use trust mortgage calculator only requires you to enter a few fields of information and then does the rest of the work for you! Simply input the current value of the property in question, the number of siblings who have an interest in the property, the existing low Proposition 13 protected property tax rate and your desired loan amount. From there we can estimate everything from your Prop 58 Property Tax Savings, your proposed loan costs and the time it will take you to recoup your loan expenses. Here is an example of what our easy to use Trust Loan Benefit Calculator looks like:

Trust Loan Calculators

Trust Loan Calculators

Try Out The Trust & Estate Loan Benefit Calculator

Our Trust & Estate Loan Benefit Calculator is free and easy to use. Click here to try it our for yourself. If you have any problems using the calculator, or have questions on trust or estate loans or would like to start the loan process, please call us at 877-464-1066. The Trust Loan Calculator is meant for estimation purposes only. When we speak with you, we will provide you with a detailed trust loan cost estimate and help you to determine you exact Proposition 58 property tax savings. Often times we are able to complete your trust loan process in under 10 days!