Homestead Exemption for Family after Debtor Has Moved

A common concern amongst bankruptcy attorneys is the filing of a bankruptcy when the divorced spouse no longer lives in the prior marital residence. For example, husband and wife have 2 children. Divorce decree permits wife and children to remain at the marital residence. Former husband now lives elsewhere. Can the debtor claim the former marital residence as exempt from creditors and the bankruptcy trustee?

As a Fort Lauderdale bankruptcy attorney, I have filed these cases without a problem, though the issue does still give me concern. A recent Florida state court decision further supports this homestead protection even though the debtor no longer resides at the former marital residence. The debtor(judgment defendant) no longer lived at the former marital property, but his family continued to live there. In Beltram v Kolb, 2011 Fla App Lexis 3482(Fla. 3rd DCA March 16, 2011), the court reversed the trial court and upheld the exemption. Since Florida law applies to interpreting the Florida homestead exemption in bankrupty, this case can be used to support a Florida homestead exemption claim in bankruptcy.

But consider if the debtor purchased a new homestead. An individual cannot have two homesteads. If anyone has had this issue, kindly post a response.



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