The North Carolina Homestead Exemption

North Carolina bankruptcy filers can protect some home equity using the federal or state homestead exemption.

By , Attorney University of the Pacific McGeorge School of Law
Updated 3/14/2025

If you're considering filing for bankruptcy in North Carolina, the North Carolina homestead exemption will help you protect the equity in your home. This article explains how much North Carolina's homestead exemption is and how to apply it in your bankruptcy case when you want to keep your house.



How Much Is the Homestead Exemption in a North Carolina Bankruptcy?

In North Carolina, you'll use North Carolina's state exemptions because the federal bankruptcy exemptions aren't available (some states allow residents to choose between the two sets). You'll find North Carolina's homestead exemption amount listed below.

North Carolina Homestead Exemption

Homestead exemption amount

$35,000; $60,000 for those 65 and older under certain conditions.

Can spouses who file a joint bankruptcy double the exemption?

Check with a local bankruptcy lawyer.

Homestead exemption law

N.C. Gen. Stat. § 1C-1601(a)(1)

Other information

Amounts are subject to change.

Where to find other exemptions.

North Carolina Bankruptcy Exemptions

Federal Nonbankruptcy Exemptions


What Property Can You Protect With the North Carolina Homestead Exemption?

The North Carolina homestead amount is $35,000 and $60,000 for those 65 and older "…if the property was previously owned as a tenant by the entireties or as a joint tenant with rights of survivorship and the former co-owner of the property is deceased." (N.C. Gen. Stat. § 1C-1601(a)(1).)

Example. Nelson owns two properties: a residential home he lives in with his children and a rental property he leases to tenants. Nelson can use North Carolina's homestead exemption to protect the equity in the residential house but not the leased property.

Also, North Carolina permits married couples to double the homestead exemption if they both own the home and file a joint bankruptcy—but not if it's one spouse's sole property. Filing for bankruptcy with your spouse can be tricky, especially if one spouse has significant separate property. It could be used to pay the other spouse's debts. Learn more about filing considerations for married couples.

Example. Andrew and Ali bought a home together shortly after marrying. They can double the homestead exemption because they're both on the home's title and filed for bankruptcy together.

Example. When Mari and John filed for bankruptcy, they lived in a home Mari purchased before marriage. The homestead exemption didn't qualify for doubling because John had no ownership interest in the property.

Other Requirements for Keeping a Home in Bankruptcy

If you can't protect all of your home equity, you might not be able to keep your home. Typically, the Chapter 7 trustee appointed to your case would sell the house, return the exemption amount to you, pay off the mortgage, and pay creditors with the amount remaining after deducting the trustee's fee.

In Chapter 13, the trustee doesn't sell property, so you could keep it. However, that doesn't mean Chapter 13 filers get a break regarding how much equity they can retain. Instead, you'd need to pay creditors the value of the nonexempt equity through the Chapter 13 plan.

But that isn't all. Keeping your home requires being current on the mortgage when filing for Chapter 7. Otherwise, you could lose it to the lender through foreclosure, possibly even during the Chapter 7 case. If you're behind on payments when filing for Chapter 13, you have an option not available in Chapter 7. You can catch up on the payments over time through the plan.

Learn about other requirements you must meet in Your Home in Chapter 7 and Your Home in Chapter 13. Also, find out why filing for Chapter 13 is better than Chapter 7 when you're behind on payments and don't want to lose your house.

Claiming the Homestead Exemption

When completing your bankruptcy forms, you'll do the following:

Because your home is likely your most valuable asset, consider consulting with a bankruptcy lawyer to ensure you can protect it in bankruptcy.

Where to Find the Homestead Exemption Statute

You can search North Carolina's statutes online on the North Carolina General Assembly website. Look for N.C. Gen. Stat. § 1C-1601(a)(1)—you'll paste it into the citation box. A local bankruptcy attorney can provide the current homestead amount and evaluate whether you qualify to keep your home in bankruptcy.

When You Can Use Bankruptcy Exemptions

You can file for bankruptcy in North Carolina after living there for over 180 days. However, you must live in North Carolina for at least 730 days before filing to use the current state's exemptions. Otherwise, you'd use the previous state's exemptions.

If you lived in multiple states during the two years before filing for bankruptcy, you'd use the exemptions of the state you lived in for the majority of the 180 days before the two years immediately preceding your filing. (11 U.S.C. § 522(b)(3)(A).)

Learn more about filing for bankruptcy after moving to a new state, the current amount of the federal cap, and other essential exceptions to homestead exemptions. Also, spouses can double some exemption amounts if both parties own the property, but not all of them. Learn about other filing considerations for spouses.

Learn more about filing for bankruptcy in North Carolina.

Need More Bankruptcy Help?

Did you know Nolo has made the law accessible for over fifty years? It's true, and we wholeheartedly encourage research and learning. You can find many more helpful bankruptcy articles on Nolo's bankruptcy homepage. Information needed to complete the official downloadable bankruptcy forms is on the Department of Justice U.S. Trustee Program website.

However, online articles and resources can't address all bankruptcy issues and aren't written with the facts of your particular case in mind. The best way to protect your assets in bankruptcy is by hiring a local bankruptcy lawyer.

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