Homestead Declaration as Part of Estate Planning

I would wager that the main type of property you would want to have protection for when you die would be your home. Many states, including California, have what are called homestead allowance statutes. These will help to make sure that your minor children and spouse can remain in the house after you pass.

In California, there are two types of homestead instruments, a homestead exemption and a homestead declaration. They both seek to protect your home against creditors. But they differ in that an exemption does not require the recording of a document and only may prevent the forced sale of your home in the case of insufficient equity, but may not if there is actual sufficient equity. A homestead declaration must be properly drafted to comply with the law and be signed, notarized, and recorded at the county recorder's office.

The main advantage of having a homestead declaration is that if you decide to sell your house voluntarily while still owing creditors, the equity is protected for up to the dollar amount equal to the homestead exemption, for a period of six months, to reinvest in another homestead.

For more information on homestead statutes in California and how they may benefit you as part of your estate plan, contact a professional Estate Planning Attorney.


*This blog entry was not written by an Attorney and should not be constituted as professional legal advice.