Homestead Exemption

[DivorceRuinedMe]

I live in Florida and we have very little equity in our home - mostly only the 5% that we put down to close (we have an interest only loan and the market in Florida stinks so I'm sure we haven't built any equity in the couple of months we've lived in the house.) We plan to keep the house. Florida allows an unlimited homestead exemption but only 1K for personal property exemptions if you use the homestead exemption. Fl allows 4K personal property exemption if you don't use the homestead exemption.

Because of the measly 1K personal property exemption, I am losing my engagement ring as I don't have enough exemptions to protect it b/c I'm using the homestead exemption.

It just doesn't seem fair that I have no equity in my house but I'm given unlimited exemptions there and I NEED the 4K exemption to protect my ring but I can't have that due to the house!

UGH! I just needed to vent. There is no way around this, is there? I haven't asked my attorney about it b/c I've been a PEST lately to her office so I thought I'd run it by you all first.

This all could be a moot point anyway as my dad is supposed to drop the ring off to the trustee either today or a week from today. This was just floating around my mind last night and I needed to get it out. I hope I'm making sense.

[woeisme]

If you get an appraisal on the house to prove you have no equity, maybe you could not claim the homestead exemption (since there's no equity to exempt) and then use the 4K personal property exemption? Just a suggestion, although it cost me $300 to have a home appraisal, so I'd definitely ask your lawyer's office if this route might work before shelling out the $ for it. ANd then you'd have to pray that the appraiser actually comes in under what you owe on the house.

Could you find out what the trustee is going to be able to sell the ring for, and propose paying him/her that amount to keep the ring? i'm sure it will be a value much less than what the ring originally cost, I doubt he'd be able to recoup 25% of it's value now that it's "pre-owned". I know it would suck to have to re-purchase your ring, but in the trustee's eyes, you're not going to be paying for other items that you have purchased and kept and are discharging the debt through BK, so it's only fair to the creditors that they get back some of what is owed to them.

[JollyGG]

Or just find out when the auction is each month and go and buy your ring back. I'm guessing it won't go for much.

[FreshLikeADaisy]

JollyGG, what a good idea! They may even have it posted online, what the resrve price is, pictures, etc. DRM's attorney or trustee would be able to tell her the details of the auction.

[emoney]

I'm sorry about your ring, but your real estate knowledge may need a little adjustment. For example when a home is sold a cost of 10% of the sales price is about average. Your mortgage was an inviation for disaster. Interest only and only 5% down.
Try this next time 20% down and no PMI and you chose which year to pay your real estates taxes for tax savings. Plus a lower interest rate on your mortgage. This way you own the house and it does not own you.
regards,
emoney

[JollyGG]

JollyGG, what a good idea! They may even have it posted online, what the resrve price is, pictures, etc. DRM's attorney or trustee would be able to tell her the details of the auction.

Only drawback I can see is that it may be sold in a lot since it itself probably won't bring much. If that is the case then she could end up having to bid on the whole lot which would cost more and get her alot of stuff she doesn't need. However, it should be easy to find out how auctions are handled in her area.

[DivorceRuinedMe]

I'm sorry about your ring, but your real estate knowledge may need a little adjustment. For example when a home is sold a cost of 10% of the sales price is about average. Your mortgage was an inviation for disaster. Interest only and only 5% down.
Try this next time 20% down and no PMI and you chose which year to pay your real estates taxes for tax savings. Plus a lower interest rate on your mortgage. This way you own the house and it does not own you.
regards,
emoney

I did this on the OTHER house that I owned - put 50K down (my life's savings (I was only 27 at the time that we bought it). The market then went belly up, my ex wouldn't leave the house and then stuck me with it when he finally could during our horrid divorce and that house is now in foreclosure. Thankfully, my credit wasn't ruined at the time and I was able to get a decent interest rate on this house that I'm now living in. The only caveat being that it's an interest only loan (I couldn't afford much more payment due to my current financial situation after the aforementioned horrid divorce). I am striving to make at least 2 extra mortgage payments per year though (and I will make sure to designate FOR PRINCIPAL ONLY) so at least that money is going towards paying down the principal. My only other option was to rent and for what I'm paying for mortgage, it really isn't much more than what I'd be paying out in rent. It probably wasn't the smartest decision to buy the house at that time but who knows, if we stay here long enough, the market could hit an upswing and then the interest only loan really wouldn't be all that bad. Plus, we did get to buy when it was a buyers market so that did work in our favor at the time.

Just wanted to clarify that.

[DivorceRuinedMe]

Only drawback I can see is that it may be sold in a lot since it itself probably won't bring much. If that is the case then she could end up having to bid on the whole lot which would cost more and get her alot of stuff she doesn't need. However, it should be easy to find out how auctions are handled in her area.

Thanks for the suggestions guys but I don't have ANY money to buy my ring back. I do plan to watch it at auction and if it's low enough, it might work if I can make payments (which I doubt I can) but I have a feeling that it just won't work out. I've resigned myself to losing it but I just keep thinking how unfair this whole homestead thing is at this moment. I need to just let it go. Just let it go and move on.