After a judgment has been taken out against you, the creditor or holder of that judgment can try to collect it from you. One of the ways that a person may try to collect their money is by forcing you to sell your home. When people declare bankruptcy, they also can lose their property, up to the legally protected amounts. Fortunately, there are homestead or exempt property laws to protect you from losing your home and becoming destitute when you owe money.
Under Connecticut law, a “homestead” is debtor owner-occupied real property, a co-op, or mobile manufactured home used as the debtor’s primary residence. The following table has homestead protection laws.
|Code Section||Connecticut General Statutes Section 52-352b: Exempt Property|
|Maximum Homestead Property Value||The maximum property value that can be designated as homestead in Connecticut is $75,000, or for money judgments arising from hospital services, up to $175,000. For a married couple who jointly own a home, the exemption is $150,000 as each has a $75,000 homestead interest in the home.
The value is determined as the fair market value of the real property less the amount of any statutory or consensual liens on it, such as a mortgage. For example, if you own a home worth $175,000, but you still owe $125,000 on it, the $50,000 you do own is less than the $75,000 and therefore the home can’t be forcibly sold for the debt.
However, the creditor can put a lien on the home for the amount of his or her judgment. The creditor can’t force a sale of the home until the mortgage is paid down or the value of the home goes up because only then does the amount of equity in the home exceed the exemption, minus the mortgage or other liens.
|Maximum Acreage Urban and Rural||Connecticut law doesn’t state a specific maximum acreage for any property claimed as homestead, as some states do. Often the acreage maximum varies between urban and rural lands.|
If you’re in debt and don’t know what to do, you should reach out to a local credit counseling agency. You might be able to develop and maintain a budget that allows you to avoid bankruptcy or other judgments. If you need legal advice on bankruptcy, debt, or these homestead laws, speak to an experienced Connecticut debtor attorney.
Note: State laws are revised often, thus it’s important to contact a lawyer or conduct your own legal research to verify these laws and any other law you’re reading.
Research the Law
Contact a qualified attorney.