One positive aspect of owning a home in California is the limit on property taxes. The tax itself is limited to no more than about 1% of the home's assessed value (modifiable by a super majority vote in your city or county, which rarely happens) and the assessments are limited to no more than 2% per year. So the longer you own your home, the lower your tax bills are relative to someone who just bought one. The low assessment is also portable for seniors (over 60, I think) if they "trade down" to a home of equal or lesser current market value. And the low assessment is inherited if the home passes to an offspring when the last original owner dies.
The downside is that commercial properties have exploited a loophole in the legislation by creating dummy corporations that hold the paper titles, so that the tax assessments stay artificially low even though the property really changes hands on a frequent basis. This helps to contribute to California's chronic budget problems. There is so much fear that voters will misinterpret any attempt to close the commercial property loophole as an attack on the residential protection that most politicians are unwilling even to discuss reform.
I'm about to add a couple hundred to each month's mortgage payment (compared to what I'm paying now) which, along with a slightly lower interest rate on the refi, will shorten the payoff date by about 2 years, and save about $7000 in interest costs over the life of the loan.
Due to a technical change in the lending regulations, I have to take out the refi for about $21,000 more than is actually needed. I am planning on returning that to the bank after a couple of months to bring the principal on the loan back down to what it would be if the loan were granted for the current amount actually owed.
The downside is that commercial properties have exploited a loophole in the legislation by creating dummy corporations that hold the paper titles, so that the tax assessments stay artificially low even though the property really changes hands on a frequent basis. This helps to contribute to California's chronic budget problems. There is so much fear that voters will misinterpret any attempt to close the commercial property loophole as an attack on the residential protection that most politicians are unwilling even to discuss reform.
I'm about to add a couple hundred to each month's mortgage payment (compared to what I'm paying now) which, along with a slightly lower interest rate on the refi, will shorten the payoff date by about 2 years, and save about $7000 in interest costs over the life of the loan.
Due to a technical change in the lending regulations, I have to take out the refi for about $21,000 more than is actually needed. I am planning on returning that to the bank after a couple of months to bring the principal on the loan back down to what it would be if the loan were granted for the current amount actually owed.
