Legal Question in Real Estate Law in California

Re: Protection re: homestead and transferring equity to another property

Your question raises lots and lots of issues, and my strong impression is that you need good legal representation to straighten matters out. In particular, if you have a case before the court of appeal, you need representation.

There are two types of homestead, one the Declared Homestead, the other the Homestead Exemption. The first requires filing a declaration, the other is automatic. The Homestead Exemption covers your equity in a dwelling co-owned with another, and in a foreclosure only your interest is sold. This could put your son in the position of owning a half interest in a house with a stranger, perhaps your creditor, owning the other half. Since each co-owner has right of possession of the entire property, your son could end up with hostile roommates, so to speak.

Your $125,000 homestead protection is portable, it follows you to any dwelling you own (fully or in part) and reside in. The protection is $125,000 only if you meet certain requirements (age, etc.), otherwise it is lower.

The declared homestead is not portable. If you move, you need to abandon the homestead at your former dwelling and file a new homestead for the new residence.

If you have creditor problems, you probably should declare homestead in addition to relying on the (automatic) homestead exemption. However, neither homestead prevents foreclosure in all cases and neither protects against all kinds of creditor claims against you. In particular, a homestead does not affect pre-existing liens on the homestead property, which could include the judgment lien.

There is also a hint of a suggestion that your plan includes placing some assets out of sight or out of reach of creditors. Any transfer of property which has the effect of hindering or delaying creditors runs the risk of violating the fraudulent transfer act and could get all participants in big trouble.

The sums of money involved and the level at which you're playing (bankruptcies, judgments, appeals) tells me you need your own personal legal representation, and I hope the smattering of information I've given you convinces you to obtain those needed professional services.