T Real Property

Policy

In general, the equity value of real property is counted.  For situations when real property may be excluded, see the following policy sections:

·        A Good Faith Effort to sell the property is being made (MA703E)

·        Home Property (MA705)

·        Property Essential to Self-Support (MA705S)

·        Indian Tribal Land (MA705M)

Ownership of real property can consist of an interest in the title or a right to the use of the property without title to the property, such as a life estate. To determine what part of the real property is counted as a resource, the following must be considered:

·        The customer’s ownership interest (MA704); and

·        The availability of the resource (MA703A).

NOTE          There is separate policy for property assigned to a trust.  See Chapter 800 for more information.

1)    Determining Equity Value

The equity value of real property is calculated by subtracting the balance of any mortgages, loans, or liens on the property from the current market value.

2)    Undue Hardship

Jointly owned real property that is available to the customer and would be counted may be excluded when sale of the property would cause an undue hardship to a co-owner.  Undue hardship may exist when all of the following apply:

·        The property is the co-owner’s principal place of residence;

·        The co-owner would have to move if the property were sold; and

·        The co-owner has no other readily available housing.

The value of the customer’s ownership interest in the property is excluded for as long as the undue hardship exists for the co-owner.

Definitions

Proof

Proof of ownership:

Proof of ownership interest or a life estate interest may include:

·        Deeds;

·        Assessment notices;

·        Current tax bills;

·        Current mortgage statements;

·        Report of title search; or

·        Wills, court records, or relationship documents.

Proof of CMV:

Primary proof of a property’s CMV is the assessed value from current tax bills or County Assessor records.  However, these records cannot be used if the assessment meets any of the following:

·        Was issued more than one year in the past;

·        It is a special purpose assessment that does not include a full cash value assessment;

·        It is under appeal; or

·        It is based on a fixed rate per acre method.

If the assessment cannot be used or the customer disagrees with the assessed CMV, current written estimates of the property's CMV must be obtained from two knowledgeable sources.  The estimates must identify the source of the estimate, the effective date and must be signed by the source.  Knowledgeable sources include:

·        Banks, savings and loan associations, mortgage companies, and similar lending institutions;

·        An official of the local real property tax jurisdiction;

·        The county Agricultural Extension Service;

·        Real estate brokers; or

·        The local office of the Farmer's Home Administration for rural land.

NOTE          The customer may submit any additional information that supports the claim that the value of the property is different than the assessed value.

Proof for equity value:

Proof of mortgages, loans and liens on the property may include one or more of the following:

·        Current mortgage statements that provide the outstanding loan amount or pay-off amount;

·        County Recorder records of loans and liens on the property;

·        Written statements from loan- or lienholder with the outstanding balance; or

·        Other accounting or year-end statements or balance sheets.

Legal Authority