In California, a Homestead gives protection against involuntary claims against an owner's home. If a money judgment is rendered against you in court, the person who won the judgment against you may try to collect the monetary damages by garnishing your wages, bank accounts, or having your automobile or home sold to pay off that judgment. The Homestead law protects a specific amount of equity depending on the classification of the home owner. A Homestead can be either automatic or declared. The state of California provides for an automatic Homestead, but it may still be wise to record a Declaration of Homestead with the County Recorder's office.
What are the current amounts of protection?
If you are single, you have homestead protection up to $75,000 of equity. A head of household receives a $100,000 equity exemption. If you are over 65, physically disabled or 55 years of age and have less than $15,000 annual income, your equity is protected up to $175,000.
How do I file a Declared Homestead?
If you want a Homestead Declaration on your property, you can do it easily yourself, without using a professional service. Simply purchase a Homestead Declaration form from a legal forms supply store or they can even be purchased and downloaded on line. Be sure to specify the state where the property is located when using the internet to get the appropriate document. Fill out your name and joint owner, if applicable, and the legal description of your property (this can usually be found on the Grant Deed when you purchased the property). You will need to sign the forms and have them notarized. To file, simply mail or take the form to the County Recorder’s office with the specified recording fees.
What is not covered by a Homestead Declaration?
A Homestead Declaration does not protect against the forced sale of property by a bank, savings and loan or another lender holding a mortgage deed of trust on the property. It also will not protect against a judgment for child support, spousal support or the enforcement of a valid mechanic’s lien.
Homestead Filing Services
After purchasing a property, you will probably receive mail from homestead filing services. Their letters often look official and from a government office ? leading you to believe that you must file a declared homestead. You DO NOT have to file a Homestead Declaration. California law prohibits homestead filing agencies from making false or misleading statement by presenting themselves as a government agency. The law also prohibits charging more than $25 to file a homestead declaration. And they are not to collect any fees until they have recorded the homestead declaration with your approval.
This is for informational purposes only and not meant to be a legal document. Please contact your legal professional with specific questions.