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How can I protect my home during bankruptcy proceedings?

One of the most common questions people going through bankruptcy ask is, will I lose my home? After all, debt relief is much less attractive if you lose the roof over your head in the process.

But there is good news. In Massachusetts, the Homestead Act allows you to protect up to $500,000 of equity in your primary residence when you file for bankruptcy. This provision applies to both Chapter 7 and Chapter 13 bankruptcy proceedings.

To seek protection under the Homestead Act, you must file a "Declaration of Estate of Homestead" with the county of your principal residence. Doing so prevents your creditors from attaching the property as part of your debt repayment plan. In essence, you are exempting your home from the bankruptcy judgment.

Although filing a homestead declaration can protect your home from foreclosure, it does not relieve you from your normal obligations as a property owner. For example, you must continue to make your monthly payments. You must also pay local, state and federal taxes on your property. Likewise, a homestead declaration does not remove liens on the property, such as those from contractors who performed work on your home.

Filing for bankruptcy and protection under the Homestead Act offers many people an effective, two-prong defense from aggressive creditors. However, this strategy is not available or appropriate for everyone.

The Law Offices of Kenneth E. Lindauer have been helping consumers like you with debt relief, foreclosure protection, bankruptcy filings and other services for more than 37 years. This experience has taught us that people seeking debt relief are, by definition, struggling financially. Therefore, seldom will we recommend the most expensive course of action.

Instead, we assess the severity of your financial debt and identify important assets - such as your home - that may be protected from collections. For those debts still subject to collections, we help you develop a realistic repayment plan that will satisfy you, your creditors and the court.

To find out more about how you can protect your home during bankruptcy proceedings, please visit our

Homestead Act webpage.

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