Homestead protection laws protect homeowners and other small property owners from being left homeless during times of economic strife.
Under California homestead laws, property owners may declare at least $75,000 worth of their property as a protected homestead in a bankruptcy proceeding or other actions by creditors.
How do I file a homestead declaration in California?
- Step 1: Complete the Required Forms. Evaluate if you qualify for a Homestead Exemption.
- Step 2: Notarize. The Homestead Declaration must be notarized and then filed in the Recorder’s Office of the county in which the property is located.
- Step 3: Record the Homestead Declaration at the Recorders Office.
How much is the homestead exemption in California?
California’s homestead exemption is the Super Hero of the exemption world. While other exemptions protect things worth a thousand dollars here and a couple of thousand there, the homestead protects $75,000 for a single person and $100,000 for a couple. For the elderly or disabled, the homestead balloons to $175,000.
How do you qualify for homestead?
To qualify for the Homestead Exemption, statements 1,2 and 3 must be true. You hold complete fee simple title to your primary legal residence or life estate to your primary legal residence or you are the beneficiary of a trust that holds title to your primary legal residence.
Why would you homestead your house?
In certain states, homeowners can take advantage of what’s called a homestead exemption. Basically, a homestead exemption allows a homeowner to protect the value of her principal residence from creditors and property taxes. A homestead exemption also protects a surviving spouse when the other homeowner spouse dies.
Can you homestead a house in California?
Declaring a homestead on your owner occupied, primary residence in California will protect some of your equity, ownership amount, from creditors in or out of bankruptcy. California also offers an automatic homestead exemption, that does not require filing a declaration.
What does homesteading a house mean?
The homestead exemption is a legal regime to protect the value of the homes of residents from property taxes, creditors, and circumstances that arise from the death of the homeowner spouse.
What does the Homestead Act protect you from?
The homestead law does not protect the house from “secured” claims. A Declaration of Homestead is a way to protect your home from unsecured creditors. The Declaration of Homestead protects the equity or cash value in your home. To find out the equity you have in your home, get the fair market value of your home.
Can creditors take your house in California?
A creditor with a judgement against you can legally force you to sell your house. They can turn the equity into cash. California has an automatic homestead exemption on a portion of the equity with every home purchase.
When should you file for homestead exemption?
You should file your regular residential homestead exemption application between January 1 and April 30. Early applications will not be accepted. If your application is postmarked by April 30, this will allow the district time to process it before your tax statement comes out in the fall.
Photo in the article by “National Park Service”