Poughkeepsie, NY asked in Bankruptcy for New York

Q: can you claim a homestead exemption in a chapter 13 bankruptcy if you have no equity in your homestead?

Thank you for your answers, it is much appreciated, and very helpful. for a more detailed explanation, I'm a creditor in a 13 case, I have a judicial lien on his homestead and he filed a motion to avoid the judicial lien in its entirety because it impairs etc... he owes 50 grand more than the value, he didnt even claim a homestead exemption in schedule "C" so I was trying to understand why he filed that motion, but it seems he did it because he thinks I'm not going to object or oppose the motion and is somehow trying to get rid of the debt he owes, also no payment plan has been submitted. I tried to keep the question as general as possible so I could learn. Sorry about that karra. and thank you derek, you confirmed the small amount of info that I was able to decipher from those hieroglyphics you guys call "laws" hahaha... feel free to add additional comments that could be helpful, or informative. Or heck if your curious and have no input ask away I enjoy the complexity of law

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4 Lawyer Answers
Derek John Soltis
Derek John Soltis
Answered
  • Bankruptcy Lawyer
  • Jersey City, NJ
  • Licensed in New York

A: The short answer is No, you have no equity to exempt. If later it turns out you have equity, then you should be able to modify your schedules to reflect that.

Normally the exemptions play much more importance in a chapter 7 bankruptcy to keep the chapter 7 trustee from selling your home when you have equity.

In a chapter 13, your plan has to pay as much as you would have under a chapter 7. This is where it becomes important to include all of your exemptions if you have a lot of property that a trustee would have sold under a chapter 7.

1 user found this answer helpful

Karra Kingston
Karra Kingston
Answered
  • Bankruptcy Lawyer
  • Staten Island , NY

A: Your question is a little confusing but if you have no equity in your home then there probably isn’t really a reason to claim a homestead exemption. I’m not sure if that’s what you are asking? If you are worried about your property you should speak with a bankruptcy lawyer.

1 user found this answer helpful

Howard E. Knispel
Howard E. Knispel
PREMIUM
Answered
  • Bankruptcy Lawyer
  • Commack, NY
  • Licensed in New York

A: While technically you have nothing to exempt, I always claim a homestead exemption of $1 even if there is no equity. If you need to reopen the bankruptcy to void a judgment lien you were previously unaware of, if there is not homestead exemption, you will be unable to do so. Speak to your bankruptcy attorney.

Timothy Denison
Timothy Denison
Answered
  • Bankruptcy Lawyer
  • Louisville, KY

A: No.

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