homestead exemption with judgeents???

[junker]

[junker]

OR.....is the exemption on TOP of the mortgage???? meaning if i owe 100k and exemption is 150k would the house have to sell for more than 250k for them to get a dime???

[BigJohn]

I think you won a jackpot.

I think the 150K limit applies to the equity so if you have a mortgage of $100K then I guess you could sale the house clear as long as it is under $250,000K.

[CompTweaker]

My understanding of exemptions is that the value that is exempt, is the straight up value of the property, minus the exemption.

For instance, if your exemption is 150,000, and the exempt property is worth 160,000 and you have no mortgage, then a lien holder could attempt to come after that 10,000 over the exempt value. But in your case, if you have a 100,000 mortgage, then the lien holder would have to sit on the lien in hopes the value goes up as the money owed on the mortgage by the debtor goes down. This is why liens can be renewed. But hopefully in your case it wont

[catleg]

You are correct about the exemption .. it applies to your equity in the property.

So clearly, you don't want to pay down the mortgage in advance of sale.

If you do a chapter 13, you list the judgment lien at the time of filing so that any equity you build up during the plan years is protected.

[HHM]

Is this a hypothetical question or a real situation.

The issue will come down to state law. But generally, the exemption protects you from judgment creditors foreclosing on your house to get at the equity. However, if the judgement creditor files a lien, and the lien is valid, and if you go to sell the house, the exemption doesn't apply; the judgement creditor gets paid ahead of your exemption (but after the mortgages) unless there is some lien stripping provision in your state's law.

[catleg]

Sorry about that, HHM is right (of course)....it is good to remember that there is a separate system of state exemptions which apply to collections (i.e levy and garnishment), versus the exemptions provided by the federal bankruptcy system (even though they are sometimes state-specific). I assumed the OP was talking about the former, the state exemptions for levy and garnishment. I believe there are some states where homestead is protected in this manner, but I couldn't name them for you (it not being that important to me, not living in one of them myself) :-)

[junker]

yes the situation is real...and thank you HHM for clearing that up..i will have to wait out the judgement...but have no intention of selling right away anyway...at least i am protected from a forced sale...and hopefully they wont renew...i was told by court recorder that if they dont renew the lien will fall off at 10 year mark...if they renew i will file bk...

[HHM]

There are other things they can do with the judgment besides file a lien against your house. I think "waiting" it out is fairly unrealistic, to many things are likely to change. It's ALWAYS better to deal with things then to sit around and wait for the other shoe to drop.

[Martha31]

other things?

There are other things they can do with the judgment besides file a lien against your house.

What are some of the other things the collector can do besides placing liens on the house, car or bank account?

Thanks,

Martha31

[junker]

thats what im thinking...nothing else they can do....i dont have a regular job...just ss....dont have checking acct...house is protected.to 150k equity....car is under value to take.....other than hauling me in for debtors exam to see if i am hiding anything non exempt or if i gave something of value away....i dont see where they can do anything...nothing of value is in my name....so at this point no need for a bk now....no judgment creditor i have had ...has ever renewed after 10 years....

[DeadManCrawling]

One other thing-

Not sure about Cali, but here in Florida, funds received from sale of homestead only retain their protection for purposes of buying another homestead in a "reasonable time". Courts here have decided that number is 2.5 years.

We are going through a similar event with my Dad In Law's place. We have been advised that once we sell the place, we will be filing an exemption with the county. The form will state that the account we place this money in is exempt under Florida homestead law, for two and a half years from the establishment of the account.

We then have 2.5 years to invest that money into a new homestead. Note that our attorney says "invest". We are already buying a house for him, with cash, that will be more expensive, but leaves about 60k exposed. Since that 60k is from his prior homestead, we have 2.5 years of protection and will use that money to add on to the home and renovate it for him. He has moderate alzheimer's disease and neds some specialized facilities.