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Foreclosure Forum |
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Re: Only when a sale is taking place.In Reply to: Does a Title Holding Trust trigger prop 13? posted by Chuck on December 07, 2001 at 3:07 PM : Okay two questions? : Question 1: Moving MY property from JTWROS to a Title Holding Trust, with the same owners (beneficaries) does it cause a Prop. 13 (CA) activation? I'm assuming it doesn't. : Question 2: A party in financial distress is willing to deed me their home if I pick up the payments. The mortgage has a "due on sale" clause and I don't want to qualify for the loan. I have suggested we transfer his property to a Title Holding Trust and then do an assignment of benefits to me which isn't recorded. I make his payments and sell property to another party either using a Lease Option or wraparound mortgage. What is the situation with Prop. 13 in this case? =?=?=?=?=?=?=?=?=?=?= OK Chuck, here are my answers to your two questions. Answer 1. Changing the way you hold title to your property is not considered a sale, so it will not activate a Prop 13 reassessment. Answer 2. Most uninvolved people would say that the use of a trust to get around the due-on-sale clause in an existing loan is an artful way to hide a sale from a lender and that such a move is proper and OK. However, regarding the issue of a Prop 13 reassessment, if they feel that it really amounts to a sale, as described in Question 2, then a reassessment should take place. . .because the spirit of the law should prevail over the obfuscation of form.
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