Harriet B. Alexson Banking Law Blog on Lawyers.com

California Homestead Exemption

As a financial institution with a first or second trust deed filed against the Debtor’s primary residence, you should be aware of the debtor’s right to a homestead exemption. The California homestead exemption is automatically applied to the primary residence of a debtor provided that the debtor has lived on the property continuously since the establishment of a lien. The amount of the homestead exemption is one of the following:

1. $50,000 unless the borrower is a person described in (2) or (3).
2. $75,000 if the borrower is a member of a family unit.
3. $150,000 if the borrower is:

              (A) 65 years of age or older.              

              (B) physically or mentally disabled.                  

              (C) 55 years of age or older with a combined gross annual income not more than $20,000.

The combined exemptions for spouses on the same judgment cannot exceed the amounts specified in section (2) or (3), whichever is applicable.