If you file for bankruptcy in Louisiana, the Louisiana homestead exemption allows you to protect $35,000 of your home equity; more if your debts were incurred due to a catastrophic or terminal illness or injury.
Read on to learn the specific details of Louisiana's homestead protections for homeowners in bankruptcy.
For information about how the homestead exemption works in both Chapter 7 and Chapter 13 bankruptcy, see The Homestead Exemption in Bankruptcy. For more information on exemptions, see our Bankruptcy Exemptions area.
Homestead Exemption Amounts in Louisiana
If you file for bankruptcy, Louisiana law allows owners to exempt up to $35,000 of the value of a house or other property covered by the homestead exemption.
Subject to certain limitations, homeowners can also protect the full value of their homestead against debts they incurred because of a catastrophic or terminal illness or injury.
Doubling for Married Couples
In Louisiana, married couples filing jointly for bankruptcy cannot double the amount of the homestead exemption. There may be other advantages to filing bankruptcy jointly with your spouse. To learn more check out Nolo's section on Bankruptcy Considerations for Married Couples.
The Scope of Homestead Exemptions in Louisiana
In Louisiana, the homestead exemption applies to your house together with up to:
- five acres if you live inside a municipality, and
- 200 acres if you live outside of a municipality.
The homestead exemption automatically extends to insurance proceeds for property damage if they are held in a separate escrow account, and received on account of a disaster declared by the governor.
Can You Use the Federal Bankruptcy Exemptions in Louisiana?
Some states allow bankruptcy filers to use federal bankruptcy exemptions instead of state exemptions. Louisiana is not one of those states. If you live in Louisiana, you must use Louisiana state exemptions.
In Louisiana, the homestead declaration is automatic. Louisiana residents do not have to file a homestead declaration in order to claim the homestead exemption in bankruptcy.
Homestead Exemption Rights After Death
In Louisiana, the homestead exemption continues after an owner’s death for the benefit of the surviving spouse and any minor children.
Waiver of Homestead Exemption Rights
Generally, Louisiana residents can waive homestead exemption rights. The waiver must be in writing, signed by the owner, and recorded in the mortgage records of the parish where the property is located. (Louisiana is divided into parishes the way other states are divided into counties.) For married couples, a waiver must be signed by both spouses if they own the property together and are not separated. Homestead exemption rights cannot be waived for debts incurred for medical treatment, medical services, or hospitalization.
Finding Louisiana's Homestead Exemption Statute
Louisiana’s homestead exemption is set forth at La. Rev. Ann. § 20.1. You can find Louisiana statutes online at www.legis.state.la.us under "Louisiana Laws."
For more information about how to find state statutes, check out Nolo's Laws and Legal Research area.