The California Homestead Exemption
A homestead exemption protects equity in your home from creditors. Here you’ll find specific information about the homestead exemption in California.
If you file for bankruptcy in California and are eligible to use California’s bankruptcy exemptions, you can choose from two exemption systems, often called System 1 and System 2.
In California’s System 1, single homeowners who are not disabled may exempt up to $75,000 of the equity in their home or other property covered by the homestead exemption. You may exempt up to $100,000 if you live with a family member; $175,000 if you are 65 or older, or physically or mentally disabled; $175,000 if 55 or older, single, and earn a gross annual income under $15,000 or are married and earn a gross annual income under $20,000 and creditors seek to force the sale of your home. If you are married but separated, you may claim the homestead exemption in community property occupied by your spouse.
In California’s System 2, homeowners can exempt up to $22,075 of the equity in their home.
Some states allow married couples filing joint bankruptcy petitions to double the amount of the homestead exemption. California, however, does not allow married couples to double the homestead exemption amount.
In California System 1 the homestead exemption applies to real or personal property where you reside, including a mobile home, boat, stock cooperative, community apartment, planned development, or condominium. In System 1, the homestead exemption also applies to proceeds from a forced sale of your home received six months prior to bankruptcy.
In California System 2 the homestead exemption applies to real or personal property that the debtor or a dependent of the debtor uses as a residence, including a cooperative, or a burial plot for the debtor or dependent of the debtor.
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