Legal Question in Real Estate Law in California
Under the California Homestead Declaration am I protected in a foreclosure or a short-sale due to medical expenses?
2 Answers from Attorneys
Probably not......a declared homestead protects you against enforcement of involuntary liens, filed after the date of the homestead declaration. Even then, the homestead doesn't prevent a foreclosure, it merely limits the creditor's rightto the proceeds.
A declared homestead does not afford any protection against a voluntary lien, such as a mortgage ornote and deed of trust. (Such liens are "voluntary" in the sense that you agreed to put up your property as collateral. An example of an "involuntary" lien is a lien created by a judgment against you.)
The reason for a foreclosure (or short sale) is generally not a deciding factor in the rights of the creditor.