If you file for bankruptcy in Montana, the homestead exemption protects up to $350,000 ($700,000 for married couples) of equity in your home.
In bankruptcy, a homestead exemption protects equity in your home. Here, you'll find specific information about the homestead exemption in Montana. For general information about how the homestead exemption works in both Chapter 7 and Chapter 13 bankruptcy, read The Homestead Exemption in Bankruptcy.
How Much Is the Homestead Exemption in a Montana Bankruptcy?
In Montana, you'll use Montana's state exemptions because the federal bankruptcy exemptions aren't available (some states allow residents to choose between the two sets). You'll find Montana's homestead exemption amount listed below. Contact a local bankruptcy lawyer for current amounts and to find out about filing considerations for spouses.
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Montana Homestead Exemption |
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Homestead exemption amount |
$350,000 |
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Can spouses who file a joint bankruptcy double the exemption? |
Yes |
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Homestead exemption law |
Mont. Code Ann. §§ 70-32-104; 25-13-615 |
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Other information |
Protects up to 320 acres (more below); amounts are subject to change. |
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Where you'll find other exemptions |
Montana Legislature |
What Property Is Protected by the Montana Homestead Exemption?
Montana has one of the more generous exemptions. You'll be able to protect up to $350,000 of equity in a residence, including your home, condominium, or any other dwelling and appurtenances. The property can be up to 320 farm acres, a quarter of city acreage, or one residential acre outside a municipality. The homestead exemption also applies to sale, condemnation, and insurance proceeds for up to 18 months after the sale, condemnation, or loss.
Example 1. If you own a house worth $600,000 and have a mortgage balance of $300,000, you have $300,000 of equity in the property. If you file a Chapter 7 bankruptcy, you can use the homestead exemption to protect all equity.
Example 2. Assume your mortgage is only $100,000 and you can exempt $350,000 of your $500,000 equity. The Chapter 7 bankruptcy trustee would likely sell your house, give you $350,000 for your exemption, and use what remains after sales costs to pay unsecured creditors. If you wanted to keep the home, you could file for Chapter 13 and pay the $150,000 nonexempt equity portion to unsecured creditors through the Chapter 13 plan.
When Can You Claim the Homestead Exemption in a Montana Bankruptcy?
You can file for bankruptcy in Montana after living there for more than 180 days. However, you must live in Montana much longer before using Montana 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 immediately preceding your filing. (11 U.S.C. § 522(b)(3)(A).) Learn more about filing for bankruptcy after moving to a new state.
You'll also need to meet other timing and exemption requirements to prevent losing your home in bankruptcy. Find out more about keeping your home in Chapter 7 or Chapter 13 or consult a bankruptcy lawyer.
Claiming the Montana Bankruptcy Homestead Exemption
In Montana, you must file a homestead declaration (a form filed with the county recorder's office to put on record your right to a homestead exemption) before you file for bankruptcy to claim the homestead exemption. Contact your county recorder for information on how to file a homestead declaration. Check for the form on Montana's State website.
Finding the Montana Bankruptcy Homestead Exemption Statute
You'll find Montana's homestead exemption on the Montana Legislature website in Mont. Code Ann. §§ 70-32-104; 25-13-615. Still, the best way to learn the current homestead exemption amount and protect your assets is by consulting with a local bankruptcy lawyer.
Need More Bankruptcy Help?
Did you know Nolo has made the law easy for over fifty years? It's true, and we want to ensure 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 September 21, 2023
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