Can I keep my property while in bankruptcy in California?

If you file for chapter 7 bankruptcy in California, your home may qualify for a homestead exemption.  In California, the exemption for a homestead is between $50,000 and $125,000 depending on your age, and marital status.  Therefore, you will not lose your home while in bankruptcy in California as long as your equity in your home is fully exempt.  However, you may be required to reaffirm your debt.  A reaffirmation agreement states that you will continue to make payments on your home’s mortgage, and in turn, you are able to keep your property.  

If your equity in your property is not fully exempt, you may consider filing for chapter 13 bankruptcy to ensure that you keep your property while in bankruptcy.  If you have regular income that you can document for at least the past six months prior to filing for bankruptcy, you may qualify for chapter 13 bankruptcy.  In a chapter 13 bankruptcy, you create a repayment plan that lasts between three to five years, with monthly payments going directly to your bankruptcy trustee.  If you file for chapter 13 bankruptcy, the bankruptcy court requires that you pay at least the equivalent of the non-exempt equity you have in your home, and make up any missed payments on your mortgage.  You must pay this amount over the course of your repayment plan.