When it comes to protecting equity in a home, Florida residents can get some valuable relief from bankruptcy requirements under state law. A homestead exemption specifically protects investment in property assets when someone is entering a bankruptcy scenario.
The homestead exemption can be valuable for both Chapter 7 and Chapter 13 bankruptcies. In some cases, it can make the difference between a successful Chapter 13 bankruptcy and the need to choose an alternative process.
Experienced Florida bankruptcy attorneys understand that the homestead exemption is a significant help to many of their clients, and something that should be considered in the context of a bankruptcy decision.
Eligibility Requirements for the Homestead Exemption
Although the homestead exemption generally allows for protecting the whole amount of a property’s value, there are some restrictions. One is in acreage restriction. It’s important for property owners to know about the vast difference between protecting a property “in a city” or other higher-population area, where the maximum size for a property is one half acre, and one in a rural area, where properties up to 160 acres can apply.
There’s also a time requirement. In order to use the exemption in bankruptcy, those applying for the homestead exemption in Florida need to show that they have owned the property for over a certain number of days (roughly equal to three years) prior to filing the bankruptcy. Also, although a homestead exemption can be claimed by a family member in many cases, the applicant will generally need to show that the property involved is his or her residence.
Benefits of Florida Homestead Exemption
One of the biggest benefits of using the Florida homestead exemption is the generous monetary limit put on that exemption. At $146,450, the maximum cap on Florida’s homestead exemption is much higher than the maximum for the federal homestead exemption in bankruptcy, which is around $22,975 for a single filer. (Both state and federal caps can be doubled for joint bankruptcy filers).
Simply put, Florida’s homestead exemption is a powerful way to ensure that even those who may declare certain kinds of bankruptcy will not lose their homes due to creditor activity. Skilled Florida attorneys point out that article 10 of section 4 of the state constitution also deals with property protections and the inability of creditors to force a sale of a property, or put a lien on a property, outside of bankruptcy operations.
What Does the Florida Homestead Exemption Mean for You?
Every bankruptcy process is different and needs to be evaluated by a professional bankruptcy lawyer. If you are considering a Chapter 13 or Chapter 7 bankruptcy in the state of Florida, contact the attorneys at the Badgley Law Group at (407) 781-0420 so that they can review your case and figure out whether the homestead exemption or other protections will apply. Let a professional, attentive firm help you to shield your assets from creditors, so that you can emerge from bankruptcy with your finances in the best condition possible. Get peace of mind by working with Florida bankruptcy lawyers who understand how these cases work their way through local courts, how to approach every stage of a bankruptcy, and how to predict legal outcomes and how you will be affected.