Legal Question in Real Estate Law in California
My wife & I filed chap 7 in Wa State in Dec 09, received discharge July '10. Have/had home in WA State for 24 years that we made a surrender declaration on (severely "underwater"). Have another home in California (since Apr '04), but behind on its payments and just received Notice of Default/Intent to Accelerate from the lender. We want to now move to our California home and change our residency to there. Will the California Homestead Exemption help us to save our California home?
2 Answers from Attorneys
No, the homestead exemption does not apply to or affect voluntary liens such as mortgages and deeds of trust.
I agree with Mr. Whipple. The homestead exemption, whether recorded or automatic, applies to levies of judgment liens. It will not insulate you from foreclosure of a voluntary lien such as a mortgage or deed of trust.
If a declared homestead owner defaults on a debt secured by a consensual lien, the homestead is not protected from a nonjudicial foreclosure, that is, the homestead laws cannot be used to prevent a private sale pursuant to a power of sale conferred by the trust deed or mortgage securing the debt, as distinguished from preventing an execution of judgment sale. (Code of Civ. Proc., � 703.010 subd. (b).)
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