If you are considering filing bankruptcy, you may be worried about losing your home. In a bankruptcy, many assets are exempt to protect against losing it in bankruptcy. One of the exemptions is a homestead exemption. A homestead exemption protects homeowners and the equity in their homes from judgment creditors seeking to collect on unsecured debts. In Washington, up to $125,000 of equity in your primary residence is exempt. This can be applied to your house, townhome, condominium, mobile home, or manufactured home.
You may only take one exemption, so if you have additional property that you want to keep, you would file a Declaration of Homestead, which is a legal document that can help protect the property you are not occupying. This declaration is recorded with the county the property is located in. The homestead exemption does not property your property against secured creditors such as your mortgage company, child support, or alimony. While an attorney is not necessary to prepare a Declaration of Homestead, its ideal to get seek the advice of a knowledgeable attorney to ensure it is done correctly.
There are many things to consider when filing bankruptcy especially when it comes to wanting to protect your assets. If you have questions about the homestead exemption or homestead in general, call our office today at 206-408-8158 and schedule a free consultation.
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