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Our Contract
This is our agreement. Please excuse the lack of formatting; that is for our competitiors. The simplicity of the agreement is that either we perform as advertised or you don’t pay!
OWNER (’Client’) and California Property Tax Associates (’CPTA’) enter into this agreement in Running Springs, County of San Bernardino, state of California on the date first written above and, in consideration of the mutual promises made herein, agree as follows:Client grants CPTA exclusive right to act as Client’s agent for the purpose of minimizing property tax assessments on the property referenced above. This right shall be irrevocable through the first full fiscal year ending June 30, 2011 and thereafter renews automatically unless revoked by Client giving written notice to CPTA, prior to January 1 preceding the upcoming fiscal year, by personal delivery or by mail, registered or certified, postage prepaid with a return receipt requested, at its corporate address listed above. CPTA shall review assessment records and property data, recommend action to minimize assessed values, and represent Client before the County Assessor, County Assessment Appeals Board or other county officials. No other services are covered by this agreement. Client shall timely provide CPTA with requested information determined by CPTA to be necessary to achieve property tax reduction and shall execute all documents necessary for CPTA representation of Client throughout the assessment appeals process. Client agrees no guarantee of assessment reduction is expressed or implied and CPTA, upon determining no economic assessment reduction reasonably can be obtained for property, may cease its efforts to obtain such reductions.No compensation is due CPTA if Client does not obtain property tax savings, credits or refunds of any amounts payable. Otherwise, Client agrees to pay CPTA compensation of xx% of the first full fiscal year’s savings and/or refunds, plus xx% of any prior years savings or refunds. Savings and/or refunds shall also include supplementals, penalties and/or accrued interest. Fees are earned at the time the property tax assessment is corrected or revised, ar due and payable within 30 days after invoicing, and thereafter bear a finance charge of 1.5% per month on the total unpaid portion, including unpaid finance charges. CPTA shall be entitled to receive in addition to any other costs and relief, reasonable collection and legal costs including attorney’s fees incurred in the collection of unpaid fees or the enforcement of this Agreement.
Our Fee
Them
Us
By now you have read a little about the county property tax reduction process. You may not understand everything about it but you are interested. Look at the pictures on the sides of this paragraph. Us and them. It is that simple.
Please understand that our years of experience have gained us a relationship throughout the state, county by county working with individuals in the office of the assessor. Every property circumstance is different and therefore requires different procedures and methods to secure the lowest possible value for you. That is why we are your best choice; we think differently than the rest.
We have taken cases that others have reviewed and determined that no economic reason existed to accept the property. We have went on to reduce taxes and assessed values for our client beyond their expectations. That is the reputation we have. That is why we succeed where others fail.
Our Fee. If you do not receive a property tax credit, savings or refund you pay us nothing. Otherwise, the fee for our services is a percentage of the tax savings achieved in the first full fiscal year, plus any prior years tax savings, credits or refunds. All costs associated with the assessment reduction are paid by us as needed and there is never a request for upfront fees or costs. Please call us for the fee percentage.
Our contract is simple too: 1 page.
Time is critical, deadlines are rapidly approaching. Please contact us now at (909) 867-5000 or fill out the simple form below.
Comments or questions are welcome.
The Real Estate Bubble Part 2 — The Present
The 21st century began modestly enough. But in the early 2000s things began to change. The real estate market had settled to a degree of normalcy from the early 1990s wherein a loan for real estate was based on the buyer’s ability to pay and, as homebuyers achieved a higher degree of economic stability and income they were able to step up in a modest fashion to a newer or new house. Real estate appreciation was modest and generally was not a factor in the buying decision.
But within the first few years of this new decade a new phenomenon began. Californians and indeed, Americans, among many others in the world at this time were accustomed to “owning” things far in advance of when they could be afforded. With the advent of credit there was no need to wait to purchase a desired item. In the preceding 50 years people no longer “owned” much of anything. There were loans for cars, loans for furniture, loans to pay other loans and then, easy credit to obtain credit cards. Credit cards began to be used to pay for everyday living expenses such as food and auto expenses, and many people who previously could not qualify for a credit card were nonetheless given credit cards. Credit became a means for living, and financial institutions were poised for record profits. All at the expense of the consumer who was paying outrageous interest rates on this credit card debt, frequently approaching 25% or more. Trouble was on the horizon.
Also early in the decade, creative home loans with extreme deviation from the norm were introduced to the market. Low money down and no money down, stated income, adjustable rate, teaser rate, 125% value, piggyback; the list of loans goes on and on. It seemed that every conceivable trick that could be used to qualify a buyer or a property to complete the sale was considered and then utilized. Each time a new door was opened to a previously unqualified buyer there was a house that could be sold and every house that was sold created money for the seller to buy yet a more expensive house. Additionally, there was always money to buy more “stuff” and pay down credit cards.
But we must talk here about credit cards. As stated above in the years approaching this present-day situation consumers changed their buying habits relative to credit cards. Debit cards were introduced to even those who couldn’t afford the easy-credit credit cards. Credit cards were used more and more for living expenses. Bankruptcy laws were changed so that credit card debt could not be dismissed in a bankruptcy filing which opened up even more clients for the eager and greedy financial institutions. During the early 2000s it became commonplace in many households to expand their buying practices with the increased availability of home-equity loans which granted credit lines based upon expected appreciation of home values. Another cycle began wherein a homeowner exposed to easy credit bought “stuff” (boats, motorcycles, cars, furniture, etc.), charged up some living expenses, paid minimum payments for a year or two, and then refinanced their house to pull out enough equity (usually the maximum they could get which was usually more than they should have had) to pay off their credit card debt and even have a little money to upgrade their house and buy more “stuff”. And then a year or two later they could sell their home, repeat the cycle and buy a new home with very little down payment and an incredibly low interest rate, which would qualify them for an even higher priced home than they could normally afford. This was terrific news for the economy and for all businesses from furniture stores to real estate agents, from swimming pool contractors to loan companies, and almost everybody in between.
New housing tracts sprang up everywhere. There was a mad rush to build houses and with every new housing tract came a shopping center, then office buildings and big-box department stores and shopping malls. More small businesses were needed to service the households and they sprang up everywhere. Retail, industrial and commercial space was being built at a tremendous pace. In a short period of time there was a tremendous explosion of personal wealth and net worth, based largely on homeownership and the equity therein. However, this increase was not really in cash and cash equivalents but in assets of property, both real and personal. In effect, the average homeowner owned lots of toys and “stuff” and had lots of credit card debt which continued to accumulate. But the worries were few as all that was needed was a simple home loan refinance wherein all these debts could once again be paid to be charged up another day.
Continuing on, the many California families now lived in houses far more expensive than they could afford, drove new cars, had new furniture and other “stuff” and were living the good life, at least by all outward appearances. But in fact they lived hand to mouth and had loans on most of their assets. And many of the loans had “teaser rates” that started out with low interest (the interest used to qualify them for their overpriced home) and was due to increase in one or two years. Others had high interest 2nd TD loans or loans with adjustable rates that would also increase in the future. Further still, most had incredibly high credit card debt at incredibly high interest rates.
It should be noted that during these years of incredible economic growth and real estate appreciation there began to be questions from individuals as to the reality behind the growth. Personal incomes could not support the loans necessary to purchase a median priced home in California. In fact, without the continuation of the expected appreciation and the funny loans the growth was impossible. Debates began over whether these economic circumstances were reality or just a bubble that was getting bigger and bigger. The talking heads, most of which were making incredible profits (realtors, loan companies, investment firms, banks and other financial institutions) insisted that the cycle would continue indefinitely. They denied the existence of a bubble and refused to even acknowledge the possibility. Their adversaries however, told a different story but were largely ignored.
In 2004-2005 this debate became more pronounced as different areas of California began to experience a stagnation and even depreciation in real estate values. Also around this time foreclosure news became more pronounced. But data continued to be released which showed moderate increases in values and unit sales which bolstered the claims of the talking heads, claims that there were no problems. Finally, in 2006 there was a general acceptance that the market was flat. But ridiculous smoke and mirror loans continued to be touted and the talking heads were happy to wait this out the few months they told everyone the flat market would continue. But they assured everyone that things would continue as before soon.
2006 brought continued bad news as housing inventory increased and sales decreased. New home sales all but stopped. Builders offered free swimming pools and other tremendous incentives such as landscaping packages and furnishings to try to move inventory. New home tracts were opened to outside real estate agent salespeople who could earn commissions by selling within the new home tract. In short, the new home market all but crashed around this time. And along with it, many commercial projects that were early in their existence.
Also in 2005-2006 the sale of existing single-family residences experienced a severe slow down. Decreasing home prices and slower home sales began to have an affect on the market. People weren’t buying the newer houses; they weren’t able to sell their older houses. Foreclosure filings were increasing and there was increased talk about the effect of the adjustable rate mortgages increasing from their “teaser rates” in the near future. The public began to understand there really were problems. And yet the talking heads continued the spin to convince everyone that this was simply a sideways market or at the worst, we were at the end of problem times and the good times would begin again soon.
2007 ushered in some harsh realities. People began to walk away from contracts to purchase new homes and condominiums. New home sales vanished. Existing home sales were few and far between and many realtors were not even accepting new listings. Real estate related enterprises were beginning to shut down offices and foreclosure activity was in record territory. The public was convinced there was a problem and the talking heads were getting harder to find, although many continued to defend the industry and its practices. The talk changed from whether there was a bubble to how big the bubble was and if it could pop.
Subprime mortgage news became the topic and lending practices in general began to be scrutinized. While loans for real estate purchase were still available it became increasingly more difficult to find money for all but the most credit worthy buyers. This further debilitated the crippled real state market. Now there was a discussion as to whether there was actually an economic basis to all this equity activity in the real state market or whether this was simply a house of cards that would soon come apart. Again there was extensive arguing from both sides.
The Real Estate Bubble Part 1 — The Past
August 2008 Los Angeles – In the early 1990s as the real estate market began changing, many Clients asked my opinion of the market direction. Many of these Clients held multi-million dollar properties ranging from vacant land to high-rise office buildings. Every month that went by seemed to bring worse news and many of these individuals lost everything as they failed to plan for the worst while hoping for the best. A strong word to the wise: Do not hope for the best; plan for the worst.
The following article was written be Jim Guffey, a Partner in the property tax reduction firm California Property Tax Associates located in Southern California. It is offered as a tool to assist in potential future decisions from an experience based perspective. It should be noted that things are changing so rapidly that many of the prognostications therein have already come to pass.
THE PAST
In the mid 1980s wild appreciation in the real estate market occurred. Many people used this opportunity, both in the residential and commercial sector to step up by buying and selling properties. As the market continued to explode many people and companies leveraged their ability to purchase with an expectation of continued appreciation. In effect, they bought today’s property with tomorrow’s equity. And why not? A house bought for $100,000 in a 90 day escrow might be worth $110,000 by the time it closed. The same house a year later might be worth $130,000. And the numbers worked the same way with large commercial properties. An office building bought for $10 million with a six-month escrow might be worth $11 million at the close. And a year later it might be worth $13 million. This attracted many foreign investors including a great deal of money which came from Japan.
In 1989-90 the market peaked and caught most people by surprise. During this time it became increasingly difficult to sell properties. Many experts claimed this to be only a temporary situation. Many denied a problem even existed. Nevertheless, new homes became increasingly difficult to sell and developers and contractors felt the pain. Incentives were offered and prices were reduced. Inventory was high and people began walking away from their recent home purchases because of negative equity situations and an inability to pay their mortgage payments. At this time credit cards were not an accepted way of paying bills or for purchasing consumables such as food and gasoline. Banks foreclosed on these properties and quickly turned them to get them off their books by lowering the prices. It wasn’t long before the market was flooded with foreclosures which began to dictate the market price. In many neighborhoods there were far more sales of foreclosure properties owned by banks and financial institutions than there were properties that were owner-occupied. This further depressed the market.
This trickled into the commercial sector as well since commercial projects took years of planning. Projects that began several years before it was recognized there was a problem, often with hundreds of thousands or even millions of dollars invested prior to commencement of the actual project construction moved forward. Larger projects could take years to achieve full occupancy and even smaller projects were leveraged and needed tenants willing to pay 1989 rates to pay the debt. However, existing businesses had begun cutting back and new business startups were in a decline. This resulted in a glut of commercial properties on the market. Many projects sat vacant or had large vacancies and subsequently asking rents began to fall. Huge concessions were given for leases including free tenant improvements and even free rent. This continued the downward progression of rental income thus reducing the value of income producing properties.
In 1991 and even more so in 1992 there was a general recognition that the market was in serious trouble. Those unfortunate enough to be in the midst of projects or holding inventories of speculation properties and specifically, highly leveraged properties lost vast amounts of money. The losers included financial institutions as well as individuals and companies. Obtaining loans became difficult and for many, impossible. Many banks required two appraisals from two different appraisers before committing to a loan, and then required substantial down payments. The market continued to deteriorate through the mid-1990s until it finally bottomed out around 1995.
For the next five plus years the real estate market in general was tranquil with very modest appreciation in most areas. Some areas outperformed others but the value of property was tied to the income it produced on a real-time basis and residential properties had a direct connection to the income of the buyer. Through the year 2000 things were relatively normal.
The aftermath of this devaluation left many, many people and companies bankrupt. Astute investors and developers threw caution to the wind in favor of a certain greed which resulted in decisions that were not viable for the market.
The reason for this? In my opinion, the real estate cycle is basically this. Residential properties are built and, as the income and economic circumstances of the buying public increases, property owners step up to these newer properties. Their existing properties in a lower price range are bought by the entry-level buying public. As this process continues and more new homes are built, there is a need for new commercial properties to support the new neighborhoods, as well as schools and fire stations, etc. As these new commercial properties are developed the asking rents are higher, enticing businesses to leave the older neighborhoods in favor of the higher traffic developments. Rents are higher in the new developments, justifying the cost of the development but at the same time pulling up the rents in the older developments, subject of course to the supply and demand of the market. As long as new houses are built and bought, new commercial developments are built and leased, first time home buyers have the ability to buy the houses left by the new house buyers, and new business startups lease the older properties left by the businesses relocating to the new developments, the cycle continues. But, when the market is not driven by the income and economic circumstances of the buying public, but is driven instead by the artificial gain (equity) generated by emotional desire without the underlying basis of an ability to pay, pay day has to come at some point. Without the stability of an ability to pay, the house of cards has to fall; there has to be a reckoning.
FAQs
Below are a list of California property tax value reduction FAQs we’ve put together to help you understand the taxation and representation process from county to county. Property tax assessment reduction of commercial property as well as residential property does vary; please call us for questions specific to a particular county.
If you still have questions after reviewing this page and our CAPTA website, please do not hesitate to call us at (888) 678-9TAX or use the form at the bottom of this page.
Q: Who is CAPTA (California Property Tax Associates) – and how can you reduce my property taxes in my county?
A: California Property Tax Associates is a California Partnership that specializes in real estate property tax reduction throughout the State of California. For each Client we represent we apply an organized process for compiling and analyzing available data. This includes researching the County property tax records for each individual property, examining recent sales of similar properties in the vicinity of the subject and performing a comparable valuation analysis. This is different than a normal appraisal in that we determine a property’s value based upon the provisions of the Revenue and Taxation Code; it doesn’t necessarily matter what you paid to buy or build your property or what you think the value is.
One of our partners began performing these services representing California Property tax payers in 1989. Throughout the 1990’s the focus was primarily on large commercial projects and land developments as well as upscale residential properties. We saved thousands and thousands of Californians many millions of dollars in over-assessed property taxes. Our results then, like now were based on employing a highly skilled staff, access to extensive industry information, and a clear understanding of the California property tax assessment process.
Q: We have a very complicated property of great value. Is your company capable of handling such a unique property?
A: Precisely our forte. As previously stated we are a company that thinks outside the box. We research your property and use our experience to develop the best strategy allowed by law. We have more time than the assessor’s office gives their appraisers, and more experience than many of our adversaries in the assessor’s office.
Q: Is your company successful in reducing property taxes in California?
A: The simple answer is, extraordinarily! Again, we are a company that thinks outside the box. Each county knows our agents and consultants will fight for the reduction they believe is due. As we go before the assessment appeals board County by County, we have earned a reputation as aggressive and knowledgeable adversaries. It is for this reason we frequently negotiate informally with the appraisers at the assessor’s office. It is this experience and expertise that provides you with the best possible representation.
Q: Can you tell me basically what the process is in receiving a property tax savings, credit or refund in my county?
A: County by county the rules are somewhat different. Depending on where your property is located and the procedures in place at the assessor’s office in that county the process could take anywhere from a few months to in excess of two years. We will attempt to handle your case informally without the need to file the formal appeal. Once the filing of the formal appeal takes place the county has two years to hear the case before the county assessment appeals board. Frequently negotiations continue during this process. You can rest assured that we will do our best to secure your property reduction as quickly as possible.
Q: Others claim to be able to do the same thing as you do for less money. Why shouldn’t I use them?
A: Maybe you should. If you own a single family residential home in a tract neighborhood you should at least try it yourself if you have the time. If you are successful, great! If not, if you think there’s more there that you didn’t receive come back and let us try on your behalf.
If you own a custom home of greater value or commercial property you owe it to yourself to hire a professional. While some have had success doing it on their own we have been witness to hundreds at the county assessment appeals board hearings who never got what they deserved because they didn’t understand the system. The system is fraught with difficulties as identified by an attorney who wrote this article for the California Property Tax Payers Association.
Q: If you are hired to help me, what do I have to do?
A: Almost Nothing!!! Once we discuss your property characteristics with you, we will represents you as needed to obtain a reduction in the assessed value of your property. Whatever it takes, we do all the work to see that your property is fairly assessed, even preparing the case and appealing all the way to the California Property Tax Assessment Appeals Board. And you pay nothing unless you receive documentation of the assessment reduction. NO SAVINGS, NO FEE.
Q: Are you one of those companies I read about scamming people?
A: No. In fact, we are on those websites giving links to our do-it-yourself pages. We do however take exception to being lumped in with a few bad people who are trying to mislead the elderly into paying a few hundred dollars they can’t afford to pay. As previously stated our clients are primarily well-to-do and professionals with no time to learn the system of property tax reduction in California. We are no more a scam company than H&R Block who does income taxes for people who could easily do them themselves, or Jiffy Lube changing oil for people perfectly capable of changing their own oil. They just choose not to get their hands dirty or don’t want to go buy the right tools. We are no different. Again, many of our Clients are attorneys.
Q: What is your fee?
A: At California Property Tax Associates we work entirely on a contingency basis; if you don’t receive a property tax savings, credit or refund you pay us nothing! Otherwise, our fee is simply a portion of your savings. No savings; no fee! Click the “Fee” button above to read our simple one page contract.
Q: Do I pay you every year I save the money?
A: No. Our fee is based on the documented property tax savings in the first full fiscal year. If you receive a prior year(s) savings, credit or refund we would also share in that, although generally you lose your right once filing deadlines pass for previous years. Only if you receive a further reduction in subsequent years do you pay us for the additional reduction. Please call us for further details as there are certain differences county to county.
Q: Is there a fee if my taxes aren’t reduced?
A: Absolutely NOT!!! There are no hidden fees, no up front costs, no cash out of pocket. You pay absolutely nothing until your property taxes have been reduced and you have documentation notifying you of your properties assessed value reduction.
Q: If you challenge my assessed value, can’t the County reverse itself and raise my property taxes?
A: No. Under normal circumstances the County cannot raise your value above the “Base Year” value, except by increasing it up to 2% per year, pursuant to the provisions of the Revenue and Taxation Code.
Q: Should I hire you or should I do it myself?
A: Self-representation is always an option. The difference in hiring California Property Tax Associates is that you will have a team of full-time professionals with a clear understanding of the property tax appeal process along with our industry specific databases of valuable information that, when used together will ensure an aggressive strategy to obtain the maximum property tax reduction and greatest savings for you, our Client.
Q: If I have an appeal pending do I have to pay my taxes?
A: We all know the answer to this one; unfortunately it is yes. If your taxes are not kept current, you will be responsible for interest and penalties. Once an appeal is successful you will receive a refund for the difference for what you paid and what you should have paid, based on the reduced value granted in the appeal.
Q: Will someone come out to inspect my property?
A: It is possible but probably not. Most counties have their hands full with thousands of appeals each year and they typically will rely on public records to make their case. Mostly, in preparation for a hearing, an associate of California Property Tax Associates may have to visit and inspect your property. At all times we will be discreet with the information we collect.
Q. Is the Assessor limited to raising my County property taxes by 2% after a reduction?
A: No. Just as your reduction is not limited, neither is the amount that property taxes can be restored to, up to the factored Proposition 13 base year value. This means that when the values begin to rise, your assessed value may rise again. But never more then they would have been had we have not achieved the reduction.
Q. Once my reduction has been granted for the current year will I then have to repeat the process every year?
A: California Property Tax Associates will review the data in each year concerning your property. We will ensure that your value is at its lowest each year and if necessary, go back and file an assessment appeal for further reductions.
Q. Can’t I do it myself?
A: Absolutely! But, you should first read: WHY TAXPAYERS HATE THE PROPERTY TAX SYSTEM.
Comments or questions are welcome.
