Most people want to know whether they can keep valuable property before filing for bankruptcy—especially a home. If you qualify to use the Michigan homestead exemption, you can protect some or all of the equity in your house. In this article, we explain:
For more bankruptcy information, read Filing for Bankruptcy in Michigan.
Michigan lets filers use either the federal exemption system or Michigan's state exemption system, so you'll have two homestead amounts to choose between. However, you can't mix exemptions from both lists, so you'll want to select the system that will protect your most important assets.
To help you make an informed choice, we've listed both exemption amounts below. We've also included links to more complete federal and state exemption lists so you'll have an easier time deciding which set will work best for you.
If you're married, keep in mind that spouses can double some exemption amounts, but not all. Find out about other filing considerations for spouses.
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Federal Homestead Exemption |
Michigan Homestead Exemption |
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Homestead exemption amount |
$27,900 |
$40,475; $60,725 if over 65 years old or disabled |
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Can spouses who file a joint bankruptcy double the exemption? |
$55,800 is available to spouses who co-own property. |
No. |
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Homestead exemption law |
11 U.S.C. § 522(d)(1) |
Mich. Comp. Laws §§ 600.5451(1) (m),(n),(o) |
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Other information |
Amounts will adjust on April 1, 2026. |
Amounts adjust periodically. |
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Compare other federal and state exemptions. |
Michigan Bankruptcy Exemptions |
The homestead exemption applies to your principal residence only. It could include your house, condominium, co-op unit, mobile home, motor home, boat or other watercraft, or manufactured home. The homestead exemption also applies to appurtenances to the property. If the property is outside a city, village, or recorded plat, the homestead can include up to 40 acres. If the property is inside a city, village, or recorded plat, the exemption applies to one lot or parcel.
If you hold property as tenancy by entirety with your spouse: If one spouse files for bankruptcy—not both—the bankruptcy trustee might be prevented from using the property equity to pay off debts. However, this is a tricky area of law. Talk with a local bankruptcy attorney before filing to ensure that you don't lose valuable property.
You can file for bankruptcy in Michigan after living there for more than 180 days. However, you must live in Michigan much longer before using Michigan exemptions—at least 730 days before filing, to be exact. Otherwise, you'd use the previous state's exemptions.
But suppose you lived in multiple states during the two years before filing for bankruptcy. In that case, you'd use the exemptions of the state you lived in for most of the 180 days before the two-year period that immediately preceded your filing. (11 U.S.C. § 522(b)(3)(A).) Learn more about filing for bankruptcy after moving to a new state.
In Michigan, the homestead exemption is automatic – you don't have to file a homestead declaration with the recorder's office to claim the homestead exemption in bankruptcy. Instead, when filing for bankruptcy, you'll list your homestead exemption on Schedule C: The Property You Claim as Exempt when completing your bankruptcy forms. You can find out about other requirements you'll need to meet in Your Home in Chapter 7 or Your Home in Chapter 13.
You'll find Michigan's homestead exemption in the Michigan Compiled Laws at §§ 600.5451(1)(m),(n),(o) on the Michigan Legislature website. Check for updates with the Michigan Department of Treasury in the Economic Reports section. Learn about finding state statutes in Laws and Legal Research.
Did you know Nolo has been making the law easy for over fifty years? It's true—and we want to make sure you find what you need. Below you'll find more articles explaining how bankruptcy works. And don't forget that our bankruptcy homepage is the best place to start if you have other questions!
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We wholeheartedly encourage research and learning, but online articles can't address all bankruptcy issues or the facts of your case. The best way to protect your assets in bankruptcy is by hiring a local bankruptcy lawyer.
Updated April 6, 2022