Legal Question in Real Estate Law in California

Re: homesteads

No. It only protects the stated amount of equity, above any loan[s]. A lender can foreclose and sell, keeping up to his entire loan and costs from sale. He can decide to sell even if he won't get the full amount of the loan.

Re: homesteads

If the forced sale or foreclosure you're speaking of is due to default on a mortgage, the answer is NO, the declared homestead is of no value. A declared homestead (creating by filing a declaration of homestead with the county recorder) does not provide any protection against consensual liens. (That is to say, a lien you agreed to have placed on your property, such as a deed of trust.)

However, if the forced sale or foreclosure is due to a creditor enforcing a judgment, or something of that sort, the declared homestead will shelter a certain amount of equity IF the declaration of homestead was recorded before the creditor's lien attached. It might even deter the forced sale, because the creditor might realize it will end up with nothing at all, or too little to justify a foreclosure proceeding.

So, it boils down to three questions:

(1) consensual or nonconsensual; (2) who recorded first; and then (3) how much equity can the creditor reach in the final analysis?