All Forum Posts by: Dan N.

Originally posted by @Courtney Young:

That is what I figured. I would double check with an attorney if you are going to successfully avoid reassessment. My guess is it isn't a successful change in ownership to avoid reassessment bc you still have a significant interest in the property. Most people that are trying to do prop 19 planning are doing irrevocable trusts or outright gifts to their children. But that doesn't answer your HELOC issue. I just know the date is coming up for prop 19 and you should make sure your transaction works.

Yeah we did the transaction through an attorney specializes in Prop 19, and it should be fine in terms of the property tax. The only worry we have now is with our mortgage/HELOC. We're willing to just give up on the HELOC as long as our current mortgage is preserved.

Originally posted by @Courtney Young:

What state are you in? And what are your reasons for adding your kids to tile?

California. Adding them to the title to avoid the property tax hike that will happen once my kids inherit the property.

My wife and I just added our children to the deed of our house, which we currently have a mortgage on. We also happen to be in the middle of applying for a HELOC with the same mortgage lender. We started the application process before adding our children to the title and the lender is about to send our application to the underwriters. My wife and I don't want to jeopardize our current mortgage (our children have no income), and we are worried that going through with this HELOC might cause our lender to see that our children are now on the deed, thereby invalidating our current mortgage and causing problems with the HELOC as well. Would it be best to just cancel the HELOC application at this point? We also aren't sure whether it's best to openly discuss this with our lender because we don't want them to invoke the due-on-sale clause, as we have technically transferred ownership of a portion of our property to our children. Any advice would be appreciated!

Originally posted by @Jason Wray:

Dan,

Relax and do not worry about your children being on the title. That will not hurt your chances on getting a HELOC as only one income is needed to qualify not all parties on title. Having a child/children on title does not hurt you in any way unless they are over 18YR of age and they have power of attorney. But that is for Trust/Estate issues and does not apply to your question. Unless your lender has some strict overlays you should be fine with your current situation. If they were quit claimed onto the deed then the names may appear and they may need title to draw specific docs but they handle that on the UW/closing side. Typically it's best to explain your situation up front during the application so that it does not slow your closing down.

Our children are actually both over 18. One of them is our dependent, but the other is not. And they both do not earn any income. But you mentioned that this likely wouldn't be an issue either since it is only for HELOC?

My wife and I just added our children to the deed of our house, which we currently have a mortgage on. We also happen to be in the middle of applying for a HELOC with the same mortgage lender. We started the application process before adding our children to the title and the lender is about to send our application to the underwriters. My wife and I don't want to jeopardize our current mortgage (our children have no income), and we are worried that going through with this HELOC might cause our lender to see that our children are now on the deed, thereby invalidating our current mortgage and causing problems with the HELOC as well. Would it be best to just cancel the HELOC application at this point? We also aren't sure whether it's best to openly discuss this with our lender because we don't want them to invoke the due-on-sale clause, as we have technically transferred ownership of a portion of our property to our children. Any advice would be appreciated!

My wife and I just added our children to the deed of our house, which we currently have a mortgage on. We also happen to be in the middle of applying for a HELOC with the same mortgage lender. We started the application process before adding
our children to the title and the lender is about to send our application to the underwriters. My wife and I don't want to jeopardize our current mortgage (our children have no income), and we are worried that going through with this HELOC might cause our lender to see that our children are now on the deed, thereby invalidating our current mortgage and causing problems with the HELOC as well. Would it be best to just cancel the HELOC application at this point?

We also aren't sure whether it's best to openly discuss this with our lender because we don't want them to invoke the due-on-sale clause, as we have technically transferred ownership of a portion of our property to our children. Any advice would be appreciated!

My wife and I just added our children to the deed of our house, which we currently have a mortgage on. We also happen to be in the middle of applying for a HELOC with the same mortgage lender. We started the application process before adding our children to the title and the lender is about to send our application to the underwriters. My wife and I don't want to jeopardize our current mortgage (our children have no income), and we are worried that going through with this HELOC might cause our lender to see that our children are now on the deed, thereby invalidating our current mortgage and causing problems with the HELOC as well. Would it be best to just cancel the HELOC application at this point? We also aren't sure whether it's best to openly discuss this with our lender because we don't want them to invoke the due-on-sale clause, as we have technically transferred ownership of a portion of our property to our children. Any advice would be appreciated!

We read that there is a capital gains tax exclusion of $250,000 per person. My wife and I bought a home 40 years ago for just a few thousand dollars and the home is now worth $4 million. My three children are on the deed of our house, so there are five people total along with my wife. We have all been living in this house since COVID started and we want to sell it in the next year or so. Is it true that if all my children stay living in the home for a total of two years (plus owning it for more than two years as co-owners), then all five of us can each get $250,000 exempted from capital gains tax when we sell the house?

And if my wife and I purchase a new house with these proceeds, since we are over 55 years old, what happens if we buy a house that is more expensive than the portion of the house that we own and are living in now? We own about 50% of our current house, which comes out to about $2 million.

We read that there is a capital gains tax exclusion of $250,000 per person. My wife and I bought a home 40 years ago for just a few thousand dollars and the home is now worth $4 million. My three children are on the deed of our house, so there are five people total along with my wife. We have all been living in this house since COVID started and we want to sell it in the next year or so. Is it true that if all my children stay living in the home for a total of two years (plus owning it for more than two years as co-owners), then all five of us can each get $250,000 exempted from capital gains tax when we sell the house? 

Hello,

My wife and I have multiple properties in California (most of which are free and clear). We decided we'd like to transfer ownership to our children so we can help them avoid the new Proposition 19 law that requires property tax reassessment upon inheritance. But we noticed that the deadline is February 11, so just wondering if it's already too late by now. Does this process take a while? Any advice would be much appreciated!