Arizona's Homestead Bankruptcy Exemption
Almost Arizona bankruptcy attorneys will preface an Arizona bankruptcy exemption explanation with the fact that Arizona is a federal bankruptcy exemption opt-out state. That means that here in the Grand canyon state, we don't use federal bankruptcy exemptions for residents who have been here long enough to use the Arizona bankruptcy exemption scheme. It is important to know which exemptions you must use, because if you don't you might wind up turning over a dear piece of property to a chapter 7 trustee. So do yourself a favor, and get an experienced bankruptcy attorney who knows what he or she is doing. Like one of the attorneys here in our office for example.
It is important to know which exemptions you must use.
The Arizona homestead bankruptcy exemption is created by Arizona Revised Statute 33-1101. ARS 33-1101 states that a debtor may exempt $150,000 of equity in a primary residence (home in which the debtor resides) from creditors. This applies to any home, whether it be a house, apartment, condo, mobile home, etc. plus the land upon which it sits. This does not include investment properties, commercial properties or any property which the debtor does not reside.
Remember that equity is not the value of the home, but the value of the home minus liens on amounts owed. Tread lightly if you do not fully know the value of your home. Do not rely on websites that estimate the value. If it is close, an appraisal may need to be done. finally, always talk to an experienced bankruptcy attorney. Do not get advice from an attorney who does not understand the bankruptcy code. Bankruptcy is unlike every other area of law. Talk to a real bankruptcy lawyer like me.