Santa Barbara Independent

Ah, November: the month of gratitude, giving, and the one that kicks off extra gifting. While it is well-known that our community has a high price tag for housing expenses, what is not so known are the different ways gifts are treated in lending. In my almost 30 years of experience, we've come across some creative ideas — in everything from monthly allowances to standard down payment help to Grandma's gold doubloons, or even gifting the equity of a property to family for them to take it over in full. Let's break down a few things so you can best execute any offer for help. The normal thought of a “gift” in lending is for the initial down payment when purchasing a property. The majority of loans still require that the person giving the gift (the “Donor”) to be a family member, though some options exist for close relationships (a k a your brother from another mother) to be the donor as well. Gifts can be for part of, or all of, the down payment in many cases, or for closing costs, toward payoff of debts in order to qualify, or even for equity. In all accounts, the ability for the donor to give funds must be proven — typically by their most recent bank statement; as well as how the funds are received for the borrower to be used. Heads up, though: Hard cash itself is not typically allowed, as the source of it cannot be verified. Sometimes, the borrower puts this directly into their bank account, and other times it can be directly to the escrow for closing. Though, if you are on the account with the donor, funds are not considered a gift. Instead, the other account holder would verify that you can use the funds as needed for your loan purpose. One more point to keep in mind is that the IRS's limitation for gift versus income is not the same as a lender's. They're separate, so be sure to ask the questions you need for success. A Gift of Equity is a unique situation where the owner of the property is giving the buyer of the property not cash, but equity in the home. For example, Mom has a house worth $1 million, and she then gifts 40 percent of it to her child getting the loan. The borrower then gets a loan for 60 percent of the property. In this situation, what's extra unique is that the sales price does not have to be at market value. Lenders never set the purchase price of a property; we only support the value of it for lending purposes. So, in this above example, the appraised, or market, value of the property could be $2 million. This is a cool, unique way to keep property in the family, so reach out to your lender to see if it's an option for you. All of the above is so far addressing gifts as assets, but what about if it is income? The reality is that many of us support our families financially each month with a check. However, because this is not a required payment, it cannot be included in qualifying income. Trusts, or family partnerships that distribute income, are totally different, so be sure to connect accordingly if that is what you want to set up as support. This also applies to any sort of support from one spouse to another in a divorce situation. Simply because one spouse is giving money to another each month until their legally binding divorce decree is finalized does not mean that it is income that can be used to qualify. Again, the thought here is that it is not required and could be adjusted or canceled at discretion. Lastly, some folks can qualify for grants toward housing from municipalities and charities. These are also not gifts and cannot be used for every type of lending situation. Not all grants and assistance are created equal, and it's imperative to know what any requirements you might have for payback if you do use these funds. We are fortunate to live in a community that has such a philanthropic heart. Giving is in our nature here, and we all work to support those around us in so many ways. Having a conversation with your lender about what you can do will set you up for success. There are so many options that exist to support your goals and getting them on the table is key. As we progress through this month of gratitude into the holiday spirit, know that the best gift of all is doing your best for everyone around you. Austin Lampson is a licensed mortgage professional and branch manager of Movement Mortgage. She has spent the last quarter-century helping her clients balance math and emotion to achieve their financial goals. Reach Austin at (805) 869-7100, , or visit

Celebrating the giving heart of this community for more than a century.

This home in Mar Vista was transformed from a typical tract house into a contemporary and energy efficient residence. | Credit: Andy Wang; W Architectural Photography Passive House design is the best option architects have today for a net-zero future, and it is up to us and our clients to make this future a reality. The building industry accounts for nearly 40 percent of global carbon emissions, and almost half of that is from the energy required to light and climatize buildings. It's an open secret in our industry that LEED and EnergyStar are not enough. These methods of designing energy-efficient buildings often involve a set of general best practices or rules of thumb, which — while beneficial — can mean missed opportunities to optimize energy use. As others have reported, like Daniel Brook in his 2007 article for Slate “It's Way Too Easy Being Green,” the imprecise LEED Rating Checklist System, along with pressure to get buildings certified, can force architects to “design around the checklist rather than to build the greenest building possible.” By contrast, Passive House empowers architects to make informed decisions based on actual thermodynamic calculations to reduce energy use. Developed by German engineers, Passive Houses are based on principles including super-insulation, air-tightness to prevent energy loss through leakage, and thermal-bridge-free design so energy doesn't escape through conductors, like a piece of metal for a balcony that penetrates the insulation layer. The Passive House approach also incorporates measures to recapture energy in previously heated air through heat recovery ventilators, to optimize natural lighting, and to minimize solar heat gain. When designing a Passive House building, architects create an energy model that precisely calculates the BTUs of energy transferring across assemblies like windows, roofs, and floors. The model also takes into account the heat generated by building systems, like the water boiler. It outputs a number that represents the total amount of energy transfer between the building and the outdoors. If the number is negative, the building requires heating. If it is positive, it requires cooling. The goal is to get to as close to zero as possible, and with Passive House design, that's an achievable reality. In one case, well-known among Passive House designers, the amount of energy required to heat a Passive Home through a Midwestern winter was 3,300 watts. That's the amount of energy consumed by a typical hair dryer, and if you plugged it in and ran it, the hair dryer could heat the entire home. Passive House also allows architects to identify problem areas in their designs. If the house loses too much heat in the winter, architects can redesign thermal bridges to reduce heat transfer or increase the number of south-facing windows to heat the house with solar gain. If, on the other hand, the house has too much heat gain in the summer, the architect can calculate how much more insulation is needed or decrease the solar heat gain coefficient of the glass to reduce heat transfer through it. Passive Houses have a reputation for being extremely comfortable — neither too cold nor too stuffy. And, because they require little climatization through the HVAC system, they are much quieter than typical buildings whose HVAC fans produce noise as they push air. Sustainability has always been central to my work. My firm's projects champion rigorous sustainability standards. Our projects include a renovation to a home in Mar Vista that transformed what was a typical tract house into a contemporary and energy-efficient residence while preserving its structure. For the design of a studio at LinkedIn's Sunnyvale campus, we maintained most of the existing building's shell and core and introduced energy-optimized glass that brings in natural light and fresh air. As a newly Passive House–certified designer, I look forward to delivering buildings that demonstrate the power of the approach and hope it becomes standard practice. California is at the frontlines of the climate crisis. It's up to us to implement the most cutting-edge solutions available. Tim Gorter, AIA, NCARB is a licensed Passive House-certified architect with more than 25 years of field experience. He founded Tim Gorter Architects in 2010. Architecturally Speaking is written by members of the American Institute of Architects' Santa Barbara chapter.

I am concerned about one party being in power after the last election. After all, look at how that has worked out for California for the last three decades!

Laura Branch, teacher of the year.

Fire and smoke damage close nightclub; smoke affects neighboring properties.

Santa Barbara International Film Festival to honor actor as Arlington Artist of the Year on February 11.

Isla Vista, CA— The Isla Vista Community Services District (IVCSD) is thrilled to announce the launch of the Civic Leaders Initiative:

Nationwide experts interested in old vine near the historic San Jose Winery; plus, Mad Crush book about Saucelito Canyon harvest is re-released; and stories you may have missed.

Learn the secrets of a tamale chef on December 7.