New York state as well as federal laws provide individuals going through bankruptcy with a homestead exemption. This exemption is a value of real property that a person may protect from his creditors when the Chapter 7 liquidation of assets process begins. However, not all New York residents are eligible for the same homestead exemption. An important factor will determine how much of an exemption a person may claim.
The amount of the homestead exemption will depend upon the county in which a house is located. In certain metropolitan counties, such as Suffolk, Westchester and Queens, the individual homestead exemption is $150,000. That amount can be doubled for a couple that files together and raised to a $300,000 exemption. In some other counties, the exemption for an individual is $125,000 or $250,000 for a couple filing together.
In Rockland County, the homestead exemption is $75,000 for an individual and $150,000 for a couple. That means that if a couple’s house is valued at more than $150,000, it may not be fully protected. The federal homestead exemption is significantly less than that of any county in New York, and New York residents who plan to file for bankruptcy can only claim the state or federal amount.
The homestead exemption is intended to give homeowners a way to protect some of the equity that they have built up in their homes. A person must have lived in his home for a certain amount of time before the exemption will attach to his bankruptcy proceeding. Individuals with specific questions about whether they are eligible for the homestead exemption can work directly with their own legal professionals to better understand the facts of their cases.
Bankruptcy provides many people with a way to overcome burdensome financial debt when unemployment, illness and other events cause them to suffer setbacks. Aside from the homestead exemption, other exemptions may be available to some debtors for the protection of their personal property. If you are dealing with overwhelming debt, attorneys who work in the bankruptcy field may be able to help you protect your home and possessions. These professionals help their clients to assess their situations in order to file for the most appropriate forms of bankruptcy.