Automatic and
Declared Homesteads
California Homestead Laws
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California homeowners have two types of Homestead Exemption
procedures available to establish the priority of the homestead equity
they have in their home:
|
· The Automatic Homestead Exemption or Statutory Homestead Exemption,
and
·
The Declaration of Homestead which is recorded in the County
Recorder’s Office. |
Both homesteads provide the same home equity protection provided to
all homeowners in California. Notwithstanding, under a Declaration of
Homestead, additional benefits are available to homeowners. Most
importantly, under the recorded Declaration of Homestead, homeowners have
the right to sell and reinvest their exempt equity into another house.
As of January 1, 2010, homeowners qualify for one of three amounts
of net equity homestead protection:
704.730.
(a) The amount of the homestead exemption is one of the following:
(1)
Seventy-five thousand dollars ($75,000) unless the judgment debtor or spouse of the judgment
debtor who resides in the homestead is a person described in paragraph (2)
or (3).
(2) One hundred thousand dollars
($100,000) if the judgment debtor or spouse of the judgment debtor who
resides in the homestead is at the time of the attempted sale of the
homestead a member of a family unit, and there is at least one member
of the family unit who owns no interest in the homestead or whose
only interest in the homestead is a community property interest with the
judgment debtor.
(3) One hundred seventy-five thousand
dollars ($175,000) if the judgment debtor or spouse of the
judgment debtor who resides in the homestead is at the time of the
attempted sale of the homestead any one of the following:
(A) A person 65 years of age or older.
(B) A person physically or mentally
disabled who as a result of that disability is unable to engage in
substantial gainful employment. There is a rebuttable
presumption affecting the burden of proof that a person receiving
disability insurance benefit payments under Title II or supplemental
security income payments under Title XVI of the federal Social Security Act
satisfies the requirements of this paragraph as to his or her
inability to engage in substantial gainful employment.
(C) A person 55 years of age or older
with a gross annual income of not more than fifteen thousand
dollars ($15,000) or, if the judgment debtor is married, a gross
annual income, including the gross annual income of the judgment
debtor's spouse, of not more than twenty thousand dollars ($20,000) and
the sale is an involuntary sale.
(b) Notwithstanding any other
provision of this section, the combined homestead exemptions of
spouses on the same judgment shall not exceed the amount specified in
paragraph (2) or (3), whichever is applicable, of subdivision (a),
regardless of whether the spouses are jointly obligated on the judgment
and regardless of whether the homestead consists of community or
separate property or both.
Notwithstanding any other provision of
this article, if both spouses are entitled to a homestead exemption,
the exemption of proceeds of the homestead shall be apportioned
between the spouses on the basis of their proportionate interests in
the homestead. |
Homeowners that are anticipating the need to rely on a homestead exemption
for protection against creditors should immediately consult with an
experienced attorney.
For a no cost initial
consultation
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