Many carriers of debt avoid bankruptcy in fear of endangering the ownership of their homes. This fear should be somewhat alleviated by a significant increase in the homestead exemption also referred to as a home equity exemption limit allowed in California bankruptcy courts. Since January 1 of 2021, California bankruptcy courts have raised the home equity exemption limit to $600,000. This means that you can still qualify for a discharge of all of your debts in Chapter 7 bankruptcy if you own a home with up to $600,000 of equity. It is a significant increase from the old limits which were $75,000 for a single person, $100,000 for married couples and $175,000 if you are 65+ years of age. These were obviously antiquated home equity numbers to operate by since home values in California have skyrocketed over the past several decades. This may sound too good to be true, but it has all been proven in real bankruptcy cases filed this year. There have been actual bankruptcy cases filed in which home owners who own a home with several hundreds of thousands of dollars in equity can file a Chapter 7 bankruptcy and receive a discharge of their debts without any impact on their home ownership. If you would like more information on this, please contact Bankruptcy Law Professionals at 855 257-7671 to see how this can all work for you.
Homestead Exemption Up To $600,000 in California
