This is a sample of our first bi-monthly newsletter. It is being sent through Savicom.net (formerly PostMasterGeneral.com), an e-mail service provider. Any comments, replies, criticisms, etc, would be appreciated.

If you have recieved this newsletter more than one, we sincerely apolgize, and we will have that corrected before the next issue.

A notable change to the methods to hold title to property in California was made effective on July 1, 2001. Husbands and wives can now hold title as Community Property with Right of Survivorship. This allows owners to receive the benefits of both Community Property and Joint Tenancy without the cost of forming a Living Trust.

Community Property ownership has a major benefit of a full step-up-in-basis on any property. This could reduce capital gains in rental property and high priced homes. With Joint Tenancy, the Survivor owns the properties by survivorship and this method avoids probate.

Before this change, Joint Tenancy had the disadvantage of only a half step-up-in-basis. In Community property, one spouse could secretly will their share of the property to others (children from a previous marriage, for example). Plus, the properties would have to go through probate.

In my opinion, all homeowners without a Living Trust should get legal advice and consider changing their holding method. I don’t see this change being publicized by Real Estate Professionals. We should not advise clients about legal matters, but we should bring this change to their attention.

Talk to your Title Company and get permission to distribute their printed information on this topic. Many homeowners should change their vesting.

This background information is gratefully furnished by Debbie Banister. For information about any aspects of exchanging, call Ph: 714-269-1285 direct or 877-799-1031 Toll Free.
Email: dbannister@exchangeresources.net
Web site: www.exchangeresources.net

The Revenue Procedure (Rev. Proc. 2000-37) provides a Safe Harbor for reverse exchanges entered into on or after September 15, 2000 provided the taxpayer does the following:

1. The safe harbor allows a taxpayer to treat the Exchange Accommodation Title holder (EAT) as the beneficial owner of the property for federal income tax purposes. The parked property must be held under a Qualified Exchange Accommodation Arrangement.
2. The EAT must hold legal title or similar ownership to the property being parked.
3. The taxpayer must have the intent to park with the EAT either the relinquished or the replacement property as part of the 1031 tax deferred exchange.
4. No later than five (5) business days after the transfer of ownership of the property to the EAT, the taxpayer and EAT must enter into a written agreement indicating that this is an exchange and that the accommodating party will be treated as the owner of the property for tax purposes.
5. Within 45 days after the transfer of ownership of the replacement property to the EAT, the taxpayer must identify the property to be relinquished.
6. No later than 180 days after the transfer of ownership for the property (replacement or relinquished) to the EAT, the replacement property must be transferred to the taxpayer or the relinquished property to the ultimate buyer.

An EAT that satisfies the requirements of a Qualified Intermediary under the regulations may also enter into an exchange agreement with the taxpayer to serve as the Qualified Intermediary in a simultaneous or deferred exchange. The taxpayer can guarantee some or all of the obligations of the EAT, including secured or unsecured debt incurred to acquire the replacement property. The taxpayer can also loan or advance funds to the EAT. The parked property can be leased by the EAT to the taxpayer or enter into a property management agreement with the taxpayer.

At the latest Conventions, Expos and Training Sessions the Realtor Associations were stressing the addition of a new 4-letter word to the lawsuits being filed in Real Estate. The word is MOLD.

As a competent licensee, you now must be aware of the possibility that a buyer would sue for not being advised if any MOLD is on a property. Check with your legal advisor as to any actions you should consider. The latest CAR Transfer Disclosure now adds MOLD to the hazard statement along with asbestos, radon, lead, chemical storage, formaldehyde, etc. I would recommend that you use the latest forms.

If you are renewing or getting a license, you can now pay with a credit card. MasterCard and Visa are accepted but you must complete form RE298. You can now fax the applica- tion and payment to DRE.

The DRE website (www.dre.ca.gov) has been upgraded and is excellent. You should check the information on your License Status report on the site. Remember that this information is available to the public. A new change allows you to change your address online if you know your license number and Social Security Number.

Duane Gomer, Inc. recommends that you not use your home address if feasible. Also, you can use this site to check the license status of anyone (past and present) plus download forms, bulletins, regulations and other items.

A new Broker Course (Computer Applications) has recently been approved. This is the first addition in decades. It will be a valuable tool for the education and training of prospective Brokers.

Duane Gomer, Inc. will be submitting this course for approval immediately. Our course will cover Websites, e-Mail, researching, prospecting, and other subjects. If you would like more information, please contact our office.

If you are renewing a license in the period from now to 12/01/03, you will need to complete the State Public Benefits form. This is to verify that you are either a U.S. Citizen or a lawfully present Foreign Alien and are therefore eligible to receive a Real Estate License as it is considered a Public benefit. If you are a U.S. Citizen, you will only need to do this one time. (This is a good regulation in my opinion because it will reduce the number of licenses. On the last DRE report, there were 107,000 Brokers and 204,990 Salespersons licensed in California.)

If you have to renew a California Real Estate License, remember our popular "All 45 Hours of Tests In 1/2 Day" program. (We can present live classes at your company or association.) Also, you can renew by home-study and take your open-book exams on the Internet or with a monitor. If you know anyone who wants to get a Sales or Brokers' License, contact us at once. For any questions about renewal or licensing, visit our website and check our Frequently Asked Questions about Renewal, Sales License, Brokers' License, Conditional License, internet Testing, etc. These new pages should answer all of your questions.

Thank you for all of your support and consideration.

Duane Gomer, Incorporated
23312 Madero, Suite J
Mission Viejo, CA 92691

www.DuaneGomer.com
Phones: (949) 457 - 8930
Toll-Free: (800) 439 - 4909
FAX: (949) 455 - 9931
Email: News@DuaneGomer.com