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Not only do escrow procedures differ between Northern and Southern California, they also vary somewhat from county to county. Title companies handle closings through escrow in Northern California, whereas escrow companies and lenders handle them in Southern California. Conveyance is by grant deed. Deeds of trust with private power of sale are the security instruments used throughout the state. Foreclosure requires a three-month waiting period after the recording of the notice of default. After the waiting period, the notice of sale is published each week for three consecutive weeks. The borrower may reinstate the loan at any time prior to five business days before the foreclosure sale. All in all, the procedure takes about four months. Californians have both ALTA and CLTA policies available. In Southern California, sellers pay the title insurance premium and the transfer tax. Buyer and seller split the escrow costs. In the Northern California counties of Amador, Merced, Plumas, San Joaquin, and Siskiyou, buyers and sellers share title insurance and escrow costs equally. In Butte County, sellers pay 75%; buyers pay 25%. In Alameda, Calaveras, Colusa, Contra Costa, Lake, Marin, Mendocino, San Francisco, San Mateo, Solano, and Sonoma counties, buyers pay for the title insurance policy, whereas sellers pay in the other Northern California counties. Each California county has its own transfer tax; some cities have additional charges. Property taxes may be paid annually on or before December 10th, or semiannually by December 10th and April 10th. Annual taxes are set at no more than 1 percent of the property’s base value or purchase price. Each year following this, a two percent increase is permissible. (Proposition 13). A property transfer between husband and wife will not result in a new tax assessment of one percent of the fair market value.The homeowner’s exemption allows an owner to be exempt of the first $7,000 of the property’s full cash value. This exemption is allowed only for primary residences. Homeowner must obtain a form from the county tax assessor, and submit it by February 15 of the current tax year to be eligible for the exemption. Californians over the age of 55 also have the option of moving primary residences and taking their prior “old” tax base with them to the new property. This exception may be used only once in a lifetime. Referred to as the” Senior Citizen’s Replacement Dwelling Benefit”, Proposition 60 was a constitutional amendment approved by the voters in 1986. It is codified in Section 69.5 of the Revenue & Taxation Code, and allows the transfer of an existing Proposition 13 base year value from a former residence to a replacement residence, if certain conditions are met. California is a community-property state.
The homeowner’s exemption allows an owner to be exempt of the first $7,000 of the property’s full cash value. This exemption is allowed only for primary residences. Homeowner must obtain a form from the county tax assessor, and submit it by February 15 of the current tax year to be eligible for the exemption. Californians over the age of 55 also have the option of moving primary residences and taking their prior “old” tax base with them to the new property. This exception may be used only once in a lifetime. Referred to as the” Senior Citizen’s Replacement Dwelling Benefit”, Proposition 60 was a constitutional amendment approved by the voters in 1986. It is codified in Section 69.5 of the Revenue & Taxation Code, and allows the transfer of an existing Proposition 13 base year value from a former residence to a replacement residence, if certain conditions are met. California is a community-property state.
California is a state that requires a deed for property title transfers. A deed is a written document that legally establishes ownership of a property. In California, there are several types of deeds available, Prepared by an Investor Friendly Title Company including:
Grant Deed: The most commonly used deed in California, which transfers the owner's interest in a property and specifies the percentage of interest being transferred.
Quitclaim Deed: Used to transfer real property with an unrecorded or recorded interest, often utilized to resolve title issues, transfer property between spouses after divorce, or in informal transactions between friends or family.
Transfer on Death (TOD) Deed: Functions like a regular deed but only takes effect upon the owner's death.
To successfully transfer a property title in California, the deed must be notarized, delivered to the buyer, and recorded at the county recorder's office. Recording the deed in public records provides evidence of its existence and content, and gives constructive notice to any future parties who may claim an interest in the property.
The total cost of transferring a property title in California can vary depending on the specifics of the transaction, but may include fees for recording, transfer taxes, title insurance, escrow services, notary services, real estate agent commissions, attorney services, home inspections, and appraisals.
California is an escrow state, meaning that a real estate attorney is not required for real estate transactions. However, some argue that working with an attorney who understands California’s real estate laws can be advantageous, particularly when addressing questions about how to take the title of a property. These decisions may carry legal and tax implications, and a real estate attorney can offer valuable legal guidance.
In California, Investor Friendly title companies are responsible for gathering documents, researching property titles, issuing preliminary title reports, collecting lien payoffs, and collecting funds from the buyer and lender. They also handle disbursing payments to clear liens and recording the deed. In Northern California, title insurance companies typically manage both title and escrow services, whereas in Southern California, these tasks are often handled separately. In Southern California, escrow services can be provided by banks, escrow companies, or title companies.