What is the Homestead Exemption in Tennessee?
If you own a home in Tennessee and have made the decision to file for Chapter 7 bankruptcy, the Tennessee homestead exemption can protect the equity in your home. The amount of homestead exemption depends on your age, marital status, and whether or not you have dependents.
In Chapter 7 bankruptcy, the trustee is allowed to liquidate non-exempt assets in order to repay creditors. For residents of Tennessee, homestead exemptions can offer protection of your home equity at the state level and allow you to keep your home.
Bankruptcy exemptions are important to be aware of, as they can help you retain some of your hard-earned assets when filing for Chapter 7 bankruptcy.
How Does the Tennessee Homestead Exemption Work?
In Tennessee, the homestead exemption must be declared on your bankruptcy petition and becomes a valid exemption if there is no objection within 30 days of your meeting with creditors.
Homestead exemptions allow homeowners to declare a portion of their property exempt in a Chapter 7 bankruptcy. The decision to file for bankruptcy is a tough one. Enlisting the help of an experienced bankruptcy attorney can lessen the stress of the situation while also helping you protect certain assets. An experienced bankruptcy attorney can calculate the amount of equity and the appropriate exemption to help protect your home.
The biggest benefit of the homestead exemption is that it protects your home from debt collectors and a forced sale during the Chapter 7 bankruptcy process. The amount of money that can be claimed in a homestead exemption depends on three factors: marital status, dependents, and age.
Marital Status Exemptions
The homestead exemption allows homeowners under the age of 62 to exempt up to $5,000 of the value of their home. If the property has joint ownership, such as spouses, the amount increases up to $7,500. In order for a property to qualify, it must be the primary place of residence and you must have been a resident of the state of Tennessee for the last two and a half years.
Exemptions for Dependents
If you have at least one child, who is a minor living in the home, a homestead exemption amount of up to $25,000 can be claimed. In Tennessee, married couples with at least one eligible child in the home are able to double the amount of their exemption because each spouse receives the exemption benefit. This would increase the exemption amount to up to $50,000.
If you are unmarried and are 62 years or older, $12,500 can be claimed in the homestead exemption. If you are married and you and or your partner are 62 years of age or older, up to $20,000 can be claimed.
The Tennessee Homestead Exemption Statute
The details of the Tennessee homestead exemption can be found in Title 26, Chapter 3 of the Tennessee Code at § § 26-3-101 through 26-3-117. It is always advisable to enlist the services of a competent attorney when undertaking a delicate legal situation. Particularly when your financial future is at stake.
Chapter 7 Bankruptcy and the Tennessee Homestead Exemption
Chapter 7 bankruptcy, also known as liquidation, has the benefit of a fresh financial start. It provides much-needed debt relief for those who can’t reasonably afford to pay off insurmountable debts. It is important to thoroughly understand the details of the filing process before proceeding.
For this reason, we highly recommend contacting the knowledgable attorneys at Flexer Law. We have been serving the legal needs of Tennessee residents since first opening for business in 1981. Our firm files more bankruptcy petitions than any other law office in Middle Tennessee. We have a deep understanding of the bankruptcy process and will work diligently on your behalf to pursue the best course of action.
Flexer Law offers a free bankruptcy consultation. We’ll go over the details of your financial situation and help you chart the best course of action for your situation.
Middle Tennessee’s Top Bankruptcy Law Firm
Enlisting the help of an attorney you can trust, that will work diligently on your behalf, provides tremendous long-term value. Regardless of your financial situation, the attorneys at Flexer Law will guide you through the bankruptcy filing process. You need not worry about not being able to afford legal services. We offer payment plans to ease the burden.
We have three office locations throughout Middle Tennessee to accommodate your legal needs. Contact us for a free legal consultation and we’ll find the best solution to help get your financial life back on track.