PART THREE: Interview With Michael Wyatt California Property Tax Consulting

California Property Tax Consulting

California Property Tax Consulting

Our conversation with CEO Michael Wyatt of the Michael Wyatt Consulting firm, Real Property & Property Tax Advisory, based in Corona, CA continues…

Property Tax Transfer:  Mr. Wyatt, how do you see the inner dynamics of your average real estate conflicted estate, or trust? Meaning, the conflict between those who are determined to keep their inherited property, and those who prefer to sell…

Michael Wyatt: When your parents die, and your trust agreement says “equal shares”…. That means equal shares.  People basically just get the overall concept of getting money from a trust loan even if it doesn’t sell. If you’re going to hold a property for more than 7 years, it makes more sense, and it’s more money in your hand…  It makes more sense all around to get a trust loan; and everyone gets more money.  For short term it may not be more beneficial to not sell. 

Property Tax Transfer:  From your experience, do more people prefer to sell inherited property?  Or do they lean towards keeping property they inherit from their parents?

Michael Wyatt:  Judging from the beneficiaries that come to us, more beneficiaries end up not wanting to sell their inherited property.  And if they did want to sell, a lot of people can be easily convinced, with cash from a trust loan equalizing things for them. 

Property Tax Transfer: Aside from fast, inexpensive trust loan cash, how is it that so many beneficiaries are  easily convinced?  Relatively, anyway.

Michael Wyatt: You have to look at it this way: there are always  one or two, minimum, who  insist on selling their shares in an inherited property. And there is our initial client contact, with those who want to sell.  And that is where these family estate or trust conflicts begin.  When mom and dad die proceeds are in effect, since inheritance is not subject to capital gains tax.  But people who do plan on selling an inherited property come to see very quickly that they are going to be hit hard by capital gains tax. If they sell their property, capital gains tax always hits them. 

Property Tax Transfer: And so that, in fact, is a very strong convincing factor.                                     

Michael Wyatt: Correct. 

Property Tax Transfer:  And property tax relief in general… How did this come about in California, whereas there is nothing quite like this anywhere else in the USA?  

Michael Wyatt: Well, we have Oregon, and they’re close, with a maximum property tax rate of 3%…  which is close to California’s Proposition 13 cap of 2%.  But, right – you’re correct, that’s about it in the United States for serious,  meaningful property tax relief.  

Property Tax Transfer: So how did this type of property tax break  actually start, and evolve into such a strongly supported property tax system, with rock solid rights to parent to child transfer, or rather parent to child exclusion… consistently avoiding property tax reassessment, and so on?   

Michael Wyatt: These property tax benefits from Proposition 13 came about in California because people didn’t want property tax increases of 25% or 30%, or whatever.  It really was out of control.  And property tax rates were particularly high and unpredictable and unstable in California, for whatever reason, prior to 1978 when Prop 13 passed. So, as you know, property appreciates let’s say on average 20% per year. For the sake of argument, let’s say 20%.  But property tax values are only going up by 3%… People know intuitively that they can’t rely on the Assessors evaluation.  Property value goes up 10% or more let’s say, as opposed to assessed value going up by 2%. That’s a significant difference. 

Property Tax Transfer: Was property taxation in California so bad before 1978 that something like Proposition 13 property tax relief, parent to child transfer rights, was simply inevitable? 

Michael Wyatt: Was California really that bad before 1978, when Proposition 13 tax relief went into affect?  Yes. California was raising taxes more than any other state, before 1978. Most seniors – before Prop 13 – were reassessed at present-day rates. And many, many were forced out of their home. They simply could not afford the property tax hikes descending on them.  Period.  People, especially older people, were being impacted with higher property taxes year after year.  And in many cases – with catastrophic results, obviously.

>> Click Here for Part Four, to Continue Interview…

PART TWO: Interview With Michael Wyatt, CEO of Michael Wyatt Consulting Property Tax Advisory Firm

California Proposition 58 Property Tax Advisor

California Proposition 58 Property Tax Advisor


Our in-depth interview with CEO Michael Wyatt of the Michael  Wyatt Consulting Firm in Corona, CA continues…

Property Tax Transfer: Are there other essential benefits to using trust loans, with special Proposition 58 benefits?

Michael Wyatt: Well…  going back to Commercial Loan Corporation…  Their loans to trusts give my clients several invaluable benefits. Their terms can be a lot more flexible than an institutional lender like Wells Fargo or Bank of America.  Also, Commercial Loan Corp is self funded, and that’s basically why they can extend easier terms to clients.

Property Tax Transfer:  And compliance issues?

Michael Wyatt: Compliance for both commercial and residential property owners is far less strict.  Commercial Loan Corp doesn’t charge any fees up-front, that’s another great benefit. Plus, they don’t require paying interest on their trust loan in advance. Not only that, there is never a “due-on-sale” clause… that requires the mortgage to be repaid in full when sold; or that all or some of the interest owed must be paid up-front to secure the mortgage. No “alienation clause”… in the event of a property transfer, stating that the borrower has to pay back the mortgage in full before the borrower can transfer the property to another person. There is none of that.

Property Tax Transfer: That is impressive. We understand that using their loan-to-trust process is far less expensive – and much faster.

Michael Wyatt: No question about it. The speed of their trust loans  is much faster, typically five to seven days instead of two or three weeks. And if you sold a property outright, without using a trust loan, you have closing costs, legal fees; a commission;  etc.  It gets very expensive.  Going with a firm like Commercial Loan Corp – all costs are offset, unless you plan to keep a property for 2 or 3 years or less. Then it doesn’t make sense. But generally you’re looking at keeping that property for seven or more years, as a rule.

Property Tax Transfer: Didn’t you work for the Orange County Tax Assessor’s office for many years prior to opening up your own firm to help clients with real estate and property tax issues?

Michael Wyatt: Yes, that’s correct. I worked for the Orange County Assessors office for 25 years – working on the more complex industrial and commercial cases. I eventually became a manager reviewing ten Appraisers dealing with CA property tax law… until 2010. But it was mostly all pretty normal, average cases.

Property Tax Transfer: During all that time with the Orange County Assessor’s office, does anything stand out, looking back?

Michael Wyatt: Interestingly enough, we worked on the largest Great Park deal, which Lennar Homes purchased from the United States Navy. We actually ended up discounting the pricing on account of contamination. Coincidentally, my supervisor ended up being my partner in our current firm. By and large, most of the deals I managed were very ordinary.

Property Tax Transfer: By and large, who are your clientele?

Michael Wyatt: Most of my business, with property owners, comes from real estate attorneys… In fact, we’ve been approved by the California Bar to teach attorneys about Proposition 13 and SBE “share and share alike” – And the attorneys pre-qualify our clients. They get the value proposition right away, without much effort.

Property Tax Transfer:  At the root of it, what do you think brought about California Proposition 13 – inheriting property taxes, at a low base, from parents? 

Michael Wyatt: Let me tell you… During the time I worked for the Orange County Assessors office – Howard Jarvis, originator of the Proposition 13 property tax measure, was one of the largest apartment building owners in California… Many people don’t know this. And he saw first-hand that landlords don’t move. Citizens move – every 7, 8 years. So landlords benefited even more from Proposition 13 tax relief than the consumers! And it did benefit consumer of course, and still does. But this did help landlords even more so, and helped to keep rents low.

Property Tax Transfer: The Split-Roll commercial & business property tax – will it pass?

Michael Wyatt: The California Split-Roll tax on commercial real estate will not pass.

Property Tax Transfer: You truly believe that?  Commercial property owners will continue inheriting property taxes at a low rate; they’ll keep paying low property taxes every year, continuing to avoid property tax reassessment…

Michael Wyatt: Absolutely. Because all the big money people and power brokers in California, in Los Angeles, in the entertainment industry, in other big time industries, don’t want it. If it passed, shopping center owners and store owners would have to increase their prices on goods and services. No one in leading positions in the business world wants that. However, John Q. Public doesn’t   understand that. Big donors do understand it, and they affect the process. So the Split-Roll tax will not even get to a vote.

Property Tax Transfer: Really.

Michael Wyatt:  Really. It’s not even going to get to a vote.

Property Tax Transfer:  Not even get to a ballot? That’s incredible. Let me ask you something… Don’t consumers even suspect  that if the Split-Roll tax passed, there is no more inheriting property taxes from parents at nice low rates… No more cheap rent… All the goods and services they’re used to would go up, as landlords (owners of business and commercial properties), will be paying much higher property taxes, and will be forced to increase their tenants’ rent?

Michael Wyatt: No. Consumers typically don’t analyze these issues far enough out to see what the fiscal affect will be on them. But, even so – the public is still 99% in favor of leaving Proposition 13 in place. Despite all the misinformation in the media.

Click Here for Part Three….

PART ONE: Interview With Michael Wyatt, CEO of Michael Wyatt Consulting ~ Real Property & Property Tax Advisory Firm in Corona, CA

California Property Tax Consultant

Residential Property Tax Consultant

Michael Wyatt’s very busy consulting and advisory firm in Corona, California, Michael Wyatt Consulting, works with attorneys, CPAs, financial planners, real estate brokers and their clients; who have real property and require assistance with a property tax issue. Mr. Wyatt believes that each and every client is unique, and comes to his firm with unique real property requirements. No one is a simple number on a list at Mr. Wyatt’s firm. All real estate services are designed to customize every client’s real estate needs and solutions, with decades of experience behind every analysis, insight & service.

For 25 years, Mr. Wyatt functioned successfully as a star appraiser for the Orange County Assessor’s Office – and was consistently given the most difficult commercial, retail, office, industrial, residential and apartment project appraisal assignments. As Operations Manager, Mr. Wyatt served as a senior Commercial & Residential Review Appraiser. Michael Wyatt provided valuation and legal assistance to the Assessor’s Office top management and staff on current Assessor Office guidelines and procedures, with respect to property tax laws, appraisal best practices and techniques.

Michael Wyatt Consulting annually reviews clients’ real estate values. The firm studies and forms strategy for proposed real estate transactions, along with ensuring property tax assessment avoidance. Mr. Wyatt conducts comprehensive real property research, reviews real estate deeds and other instruments for accuracy prior to recording; and serves as a liaison between clients and the Assessor’s Office – maintaining smooth, issue-free communications, coordination and cooperation with Assessors and other essential governmental agencies.


Part one of the interview with Michael Wyatt, a California Property Tax Consultant


Property Tax Transfer: Mr. Wyatt, thank you so much for speaking with us today.

Michael Wyatt: Very glad to be able to do it. 

Property Tax Transfer: Can you tell us how you view Proposition 58, and how you explain this unique property transfer tax break to new clients?  You must have to teach certain clients about what’s involved to keep parents property taxes, avoiding property tax reassessment and what they need to focus on in order to transfer parents property taxes to themselves when inheriting property, and what’s involved with California property tax transfer, and  inheriting property taxes…

Michael Wyatt: You let them know that the Proposition 58 tax benefit entitles children of parents leaving them property to preserve the low Proposition 13 maximum 2% tax base. A California property tax transfer.  However, a lot of people don’t fully understand that you have to apply for the benefit. It’s not automatic. And it doesn’t apply to the principal home.

 Property Tax Transfer: What about explaining restrictions on this tax break?

Michael Wyatt: You have to explain to them that they get the assessed value tax benefit only if it’s a non principal home. You get the assessed value waved if for example it‘s a million dollar property… You get the million excluded – but the overage is reassessed… A lot of people don’t know that. The creators of the trust get this benefit.

Property Tax Transfer: Exactly how do you define “children” of the parent leaving property?

Michael Wyatt: The definition of ‘a child’ or “children” is typically the adult children of a decedent…But this also refers to step-parents. Step-parents can also transfer property to a step-child… Mom is a step parent and can still get the benefit. In laws get the benefit as well. You don’t have to be blood relatives.

Property Tax Transfer:  Michael Wyatt Consulting frequently works with the popular trust lender Commercial Loan Corporation, providing clients with trust loans. Beside talking to them about the California property tax transfer, how do you describe California Proposition 58, and that whole process to prospects or clients, that are sort of inexperienced with all this?

Michael Wyatt: We basically introduce the trust lender, for example Commercial Loan Corporation, as a private money lender that loans to irrevocable trusts, that applies for and works in tandem with California Proposition 58… for beneficiaries who are looking to sell their real property shares – for the purpose of facilitating “non pro-rata distribution”… So every heir gets an equal share of the entire overall estate – however, not necessarily of every asset.

Property Tax Transfer: So what happens if beneficiaries go to a conventional lender, like Wells Fargo?  Where there is no trust loan loan, no loans to to irrevocable trusts; no  tax benefits associated with property tax transfer or parent to child transfer (commonly known as parent to child exclusion), so on and so forth.  

Michael Wyatt: If there is a family that goes to a conventional, pricey lender like Wells Fargo for instance – they will always require adult children, beneficiaries that want to sell an inherited property, to ‘go off-title’, and that always triggers present-day tax reassessment. And that spells an expensive 66.66% tax hike!

Property Tax Transfer: Yes. Going “off-title”, taking your name off the title, always shifts you into a very expensive scenario. And if you use the Commercial Loan Corp. trust loan?

Michael Wyatt: Well, if the family in question uses the Commercial Loan Corp, cLoanC.com, a company we have been using for years… the loan they provide is to a trust, and not to beneficiaries; so there is no title, and no crippling 66.66% property tax reassessment. 

Property Tax Transfer:  Got it.  Can you give us an example, sir?

Michael Wyatt:  Well, for example, there might be three siblings… beneficiaries – and a house to inherit.  And this is always important to remember.  If you’re one out of the three siblings that wants to keep the inherited house,  you are definitely  looking at a 66.66% property value tax reassessment – if you’re operating without a loan to a trust, or you’re using your own cash; or getting money from a  very pricey institutional lender – typically with multiple restrictions and extremely strict terms. 

> Click Here to Continue to Part Two of the  Interview…

Michael Wyatt can be contacted at (951) 264-6152 for question  on retaining a parents low property tax base. You can reach the Commercial Loan Corporation at (877) 464-1066; or simply go to https://cloanc.com with questions on a loan to a trust, irrevocable trust, or a property in probate plus numerous other related issues.