Homestead but filing single when married

[wolverine]

Here are the facts. A married woman is filing for Chapter 7, without her husband. The house that they live in is deeded in both names, and has a value of approximately $134K. I presume this is a tenancy by the entirety, as they were married together when the house was deeded to them. In addition, there are two mortgages in both names on the house and they total approximately $64k. So there is a total positive equity in the house of about $70k.

The state is Michigan with a $34,450 homestead exemption, while we know the federal exemption is some $20k or double if jointly filed.

My questions are as follows:

1) Does the filing wife have to list the total value of the house at $134K when she has a one half interest in the house, or does she list her value in the house as only $67k? Again, husband is not filing.

2) If the answer to 1 is no, and the wife can list only her $67k interest, does the filing wife list the full amount of claims (2 mortgages) as $64K, thereby only needing to use $3K under a homestead exemption, be it state or federal?

3) How else would she protect her house and the equity in it, if the husband is not filing?

Appreciate the help, thanks.

[newbie2]

Here are the facts. A married woman is filing for Chapter 7, without her husband. The house that they live in is deeded in both names, and has a value of approximately $134K. I presume this is a tenancy by the entirety, as they were married together when the house was deeded to them. In addition, there are two mortgages in both names on the house and they total approximately $64k. So there is a total positive equity in the house of about $70k.

The state is Michigan with a $34,450 homestead exemption, while we know the federal exemption is some $20k or double if jointly filed.

My questions are as follows:

1) Does the filing wife have to list the total value of the house at $134K when she has a one half interest in the house, or does she list her value in the house as only $67k? Again, husband is not filing.

2) If the answer to 1 is no, and the wife can list only her $67k interest, does the filing wife list the full amount of claims (2 mortgages) as $64K, thereby only needing to use $3K under a homestead exemption, be it state or federal?

3) How else would she protect her house and the equity in it, if the husband is not filing?

Appreciate the help, thanks.

I don't know how the forms are filled out (we had an attorney take care of ours) but I can answer your question as to the asset / equity.

Since the wife is filing singly, she would claim her 1/2 of the equity as an asset. If there isn't enough exemption to cover the equity (the asset), then she could pay the trustee the difference or the trustee would lay claim to it.

Please make sure that you are getting an accurate market value. If you are going by SEV or taxable value alone you could be overestimating the market value greatly. I would pay for an appraisal on the home since there appears to be money that the trustee would want.

No way around this unfortunately. She is one of the few lucky people in Michigan to have equity in her house.

[wolverine]

So her 1/2 equity is listed ($67K). That is what I thought.

The second question then is whether the mortgage claims - the total amount of $64K - can be filled in for the claims portion of Schedule A. Or can she only use 1/2 of the total claim amount? Again both mortgages are in husb and wife's name.

The difference would be $64K in total claims vs $32k if claims are divided in half for a house (total value $134k) where her half equity is $67k.

It's a difference in needing an exemption for $3K vs needing one for $35k.

[newbie2]

So her 1/2 equity is listed ($67K). That is what I thought.

The second question then is whether the mortgage claims - the total amount of $64K - can be filled in for the claims portion of Schedule A. Or can she only use 1/2 of the total claim amount? Again both mortgages are in husb and wife's name.

The difference would be $64K in total claims vs $32k if claims are divided in half for a house (total value $134k) where her half equity is $67k.

It's a difference in needing an exemption for $3K vs needing one for $35k.

The full mortgage amount is listed as a secured claim. (They don't take 1/2 the mortgage for the husband and 1/2 for the wife) The mortgage company would take it from either party, they're not picky :-)

Full market value - full mortgage balance= Total equity in the home.

[wolverine]

Okay, got it. But if only the wife is filing, I don't need to list the full equity in the home, but, rather only half the equity for the wife, correct?