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AB-717 Trusts: information.(2023-2024)

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Date Published: 03/23/2023 09:00 PM
AB717:v98#DOCUMENT

Amended  IN  Assembly  March 23, 2023

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Assembly Bill
No. 717

Introduced by Assembly Member Villapudua

February 13, 2023

An act to amend Section 1062.20 of the Code of Civil Procedure, and to amend Section 51527 of, and to add Section 51347 to, the Health and Safety Code, relating to trusts. trusts, and making an appropriation therefor.


LEGISLATIVE COUNSEL'S DIGEST


AB 717, as amended, Villapudua. Trusts. Trusts: information.
(1) Existing law authorizes each court to establish and operate an interactive computer system to enable and assist pro per litigants, and to provide information regarding calculations for child and spousal support payments, court procedures, rights and responsibilities of landlords and tenants, and alternative dispute resolution.
This bill would additionally authorize the computer system to include information regarding revocable living trusts and transfer on death deeds as nonprobate means of transferring real property.
(2) Existing law requires the California Housing Finance Agency to administer a home purchase assistance program for the purpose of assisting low- and moderate-income home buyers to qualify for the purchase of owner-occupied homes, as specified. Existing law creates the Home Purchase Assistance Fund which is continuously appropriated to the agency for purposes of the program and for defraying administrative costs of the agency.
This bill would require the agency to provide information on revocable living trusts and revocable transfer on death deeds to any home buyer participating in the home purchase assistance program, as specified. By expanding the purposes for which money in a continuously appropriated fund may be used, the bill would make an appropriation.
(3) Existing law establishes the California Dream for All Program to provide shared appreciation loans to low- and moderate-income first-time home buyers. Existing law creates the California Dream for All Fund, which is continuously appropriated to the agency for purposes of the program and for defraying administrative costs of the agency. Existing law requires the agency to develop a borrower education program and disclosure statement designed to provide a borrower with sufficient information to understand the terms of a shared appreciation loan provided pursuant to the program.
This bill would require the borrower education program described above to include information on revocable living trusts and revocable transfer on death deeds. By expanding the purposes for which money in a continuously appropriated fund may be used, the bill would make an appropriation.

A revocable living trust is a trust created during one’s lifetime in which a trustee invests and manages assets for a beneficiary on the terms specified by the person who created the trust.

This bill would state the intent of the Legislature to subsequently enact legislation to create a program to educate low- and moderate-income homeowners about the resources available to access funding for higher education, and to preserve generational wealth, by creating a revocable living trust.

Vote: MAJORITY2/3   Appropriation: NOYES   Fiscal Committee: NOYES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 The Legislature finds and declares all of the following:
(a) Numerous studies have shown that a home remains the largest asset of low- and moderate-income households in California.
(b) Low- and moderate-income households are less likely to have an estate plan for preservation of assets for their heirs upon death than are higher income households reflecting the unequal access to legal services and information between income groups.
(c) The probate process for the transfer of real property of heirs is complex and expensive and reduces the amount of money available to heirs adversely impacting the generational wealth benefits of home ownership for low- and moderate-income households.
(d) The creation of a revokable living trust by a homeowner or the use of a revokable transfer on death deed can be an easier and far less costly way to transfer a home to an heir upon death by avoiding the cost and expense of probate.
(e) The state has an interest in ensuring that low- and moderate-income households are provided with information on the preservation of household wealth that can be provided by a revocable living trust or revocable transfer on death deed especially when state funds are made available for the acquisition of homes by state agencies.

SEC. 2.

 Section 1062.20 of the Code of Civil Procedure is amended to read:

1062.20.
 (a) In accordance with rules and policy of the Judicial Council, each court may establish and operate an interactive computer system to enable and assist a pro per litigant to prepare standardized pro per court documents for use in the following civil actions:
(1) Enforcement of court orders, including orders for visitation, child custody, and property division.
(2) Landlord and tenant actions.
(3) Uncontested dissolution of marriage.
(4) Probate of a will.
(b) The computer system may also provide standardized information to users, including, but not limited to, information regarding calculations for child and spousal support payments that meet the requirements described in Section 3830 of the Family Code, court procedures, rights and responsibilities of landlords and tenants, revocable living trusts and transfer on death deeds as nonprobate means of transferring real property, and alternative dispute resolution.
(c) The court may contract with a private entity to establish and operate the program and collect any fees described in subdivision (d).
(d) The court may establish and collect fees from the program not to exceed the reasonable costs to establish and operate the program.

SEC. 3.

 Section 51347 is added to the Health and Safety Code, to read:

51347.
 (a) The agency shall provide information on revocable living trusts and revocable transfer on death deeds to any home buyer participating in the home purchase assistance program.
(b) Pursuant to subdivision (a) the information on revocable living trusts and revocable transfer on death deeds may be provided as part of any agency mandated home buyer education or counseling course, by referring the home buyer to a website operated and maintained by the agency, the Judicial Council, or the superior court, or by providing a written disclosure to the home buyer.

SEC. 4.

 Section 51527 of the Health and Safety Code is amended to read:

51527.
 (a) (1) The agency shall develop a borrower education program and disclosure statement designed to provide a borrower with sufficient information to understand the terms of a shared appreciation loan provided pursuant to this chapter. The borrower education program shall also include information on revocable living trusts and revocable transfer on death deeds.
(2) The disclosure statement required by this subdivision shall include the specific terms of the shared appreciation loan offered to the borrower.
(b) (1) Before making a shared appreciation loan, a participating lender shall provide a borrower with information to access the borrower education program and disclosure statement developed pursuant to subdivision (a).
(2) A participating lender shall require the borrower to acknowledge the receipt of the disclosure statement developed pursuant to subdivision (a) before closing the loan.
(c) (1) The agency may use program funds to design and implement an ongoing borrower outreach program that provides regular disclosures or loan counseling services to a borrower while the borrower has a shared appreciation loan outstanding.
(2) The purpose of the ongoing borrower outreach program authorized by this subdivision shall be to encourage a borrower to satisfy the shared appreciation loan in a manner that is in the best interest of the borrower.
(d) (1) The agency may meet its obligations under this section by partnering or contracting with housing counselors, community organizations with expertise in housing and mortgage finance, or any other person with expertise in housing or mortgage finance.
(2) In exercising its authority under this subdivision, the agency shall take reasonable efforts to ensure that any person or organization that assists the agency in meeting the agency’s obligations under this section is free of any conflicts of interests.

SECTION 1.

It is the intent of the Legislature to subsequently enact legislation to create a program to educate low- and moderate-income homeowners about the resources available to access funding for higher education, and to preserve generational wealth, by creating a revocable living trust.