When filing for bankruptcy in Louisiana, whether Chapter 7 or Chapter 13, there are many factors to consider. “What assets are protected and what assets can be sold” is one of the most frequently asked questions. The reason being is that due to a lack of information, many people come up with their own assumptions that eventually become a personal fact and influence their decision-making.
Aside from cars and other assets, one’s home is often their most valuable possession. The one thing that stops many people who may benefit from filing bankruptcy from actually doing it is the idea that they may lose their home. Here is all you need to know about homestead exemptions during bankruptcy as a Louisiana resident.
Louisiana Homestead Exemption Facts
Those who file for bankruptcy in Louisiana have a homestead exemption that protects up to $35,000 of their home equity. This number could be higher if you incurred debts as a result of a terminal or catastrophic injury or illness. In such instances, you may be able to protect the full value of your home and other property safeguarded by the homestead exemption. The homestead exemption in Louisiana applies to your home as well as:
- Up to five acres of land if you live in a municipality
- Up to 200 acres of land if you live outside of a municipality
The exemption also extends to include compensation for property damage if the awards are held in a third-party account and came as a result of a Governor-declared disaster. With the many factors to consider, one may wonder how do they even go about requesting a homestead exemption. Unlike many other states, getting a homestead exemption is much more straightforward in Louisiana. There is no process at all for securing a homestead exemption as the state automatically applies it when you file for bankruptcy.
Numerous factors come into play when claiming a homestead exemption. Some of which are pretty straight-forward, while many others are a bit more complex. Here are a few other considerations you should be aware of as a homeowner pursuing bankruptcy in Louisiana:
- Married couples cannot double the homestead exemption if they file jointly
- You must abide by Louisiana state exemptions and not federal bankruptcy exemptions
- The homestead exemption is still in effect after the homeowner dies
- You have the right to waive your homestead exemption
The bankruptcy process can be complicated. Trust the seasoned Louisiana bankruptcy attorneys at E. Orum Young Law Offices to provide you with legal insight. With over 20,000 bankruptcies filed in Northeast Louisiana, we can evaluate your current financial situation, help you choose between Chapter 7 and Chapter 13 bankruptcy, and serve as your legal counsel throughout the process. Northeast Louisiana Legal Services has three times recognized Mr. Young as a community leader by presenting him with the Pro Bono Attorney award for his dedication to serving his community.
Contact us today for a free case evaluation. Our Trial Guarantee ensures that we will take your case to trial per your request.