Title Concepts Plus - Declaration of Homestead to Protect your Equity

M

matt138_IHB

New member
This blog is the best bullshit filter around, so here goes: My buddy just bought a place and he received a letter from "Title Concepts Plus". It basically asks for $50 to file a Declaration of Homestead on his property to protect his equity (what equity?) from a judgement or lien on his property due to unforeseen circumstances (ie unpaid medical bills). Does this even exist or is this a scam?
 
[quote author="matt138" date=1250682775]This blog is the best bullshit filter around, so here goes: My buddy just bought a place and he received a letter from "Title Concepts Plus". It basically asks for $50 to file a Declaration of Homestead on his property to protect his equity (what equity?) from a judgement or lien on his property due to unforeseen circumstances (ie unpaid medical bills). Does this even exist or is this a scam?</blockquote>
A Declaration of Homestead does exist but that company is trying to scam a few bucks because anyone can pick up one of those forms and get them notarized and recorded by the county by themselves.
 
[quote author="awgee" date=1250718282]How much equity is actually protected from lawsuits by homesteading?</blockquote>
I believe it's $100k but don't quote me on it.
 
[quote author="usctrojanman29" date=1250720522][quote author="awgee" date=1250718282]How much equity is actually protected from lawsuits by homesteading?</blockquote>
I believe it's $100k but don't quote me on it.</blockquote>


I saw a letter like this recently and I think it's $75k for a husband/wife couple.
 
I use Firefox, and it has a Google search bar up at the top right of the browser to make <a href="http://www.leginfo.ca.gov/cgi-bin/displaycode?section=ccp&group=00001-01000&file=704.710-704.850">searching for things like this really easy</a>.



704.730. (a) The amount of the homestead exemption is one of the

following:

(1) Fifty thousand dollars ($50,000) unless the judgment debtor or

spouse of the judgment debtor who resides in the homestead is a

person described in paragraph (2) or (3).

(2) Seventy-five thousand dollars ($75,000) if the judgment debtor

or spouse of the judgment debtor who resides in the homestead is at

the time of the attempted sale of the homestead a member of a family

unit, and there is at least one member of the family unit who owns no

interest in the homestead or whose only interest in the homestead is

a community property interest with the judgment debtor.

(3) One hundred fifty thousand dollars ($150,000) if the judgment

debtor or spouse of the judgment debtor who resides in the homestead

is at the time of the attempted sale of the homestead any one of the

following:

(A) A person 65 years of age or older.

(B) A person physically or mentally disabled and as a result of

that disability is unable to engage in substantial gainful

employment. There is a rebuttable presumption affecting the burden

of proof that a person receiving disability insurance benefit

payments under Title II or supplemental security income payments

under Title XVI of the federal Social Security Act satisfies the

requirements of this paragraph as to his or her inability to engage

in substantial gainful employment.

(C) A person 55 years of age or older with a gross annual income

of not more than fifteen thousand dollars ($15,000) or, if the

judgment debtor is married, a gross annual income, including the

gross annual income of the judgment debtor's spouse, of not more than

twenty thousand dollars ($20,000) and the sale is an involuntary

sale.

(b) Notwithstanding any other provision of this section, the

combined homestead exemptions of spouses on the same judgment shall

not exceed the amount specified in paragraph (2) or (3), whichever is

applicable, of subdivision (a), regardless of whether the spouses

are jointly obligated on the judgment and regardless of whether the

homestead consists of community or separate property or both.

Notwithstanding any other provision of this article, if both spouses

are entitled to a homestead exemption, the exemption of proceeds of

the homestead shall be apportioned between the spouses on the basis

of their proportionate interests in the homestead.
 
[quote author="Geotpf" date=1250741495]But if they can still foreclose and take your home, what, as a practical matter, does this actually do?</blockquote>


Here's an example of how the homestead exemption can help you:



Facts:

Your house is worth $500,000.

You owe bank $400,000 secured by t/d on house.

You owe American Express $100,000.



Without exemption, if bank forecloses on you, you'll receive $100,000 which AmEx can take from you so you'll end up with nothing.



With exemption, if bank forecloses on you, you'll receive $100,000, $75,000 of which AmEx can never touch.
 
<a href="http://www.la.bbb.org/Business-Report/Title-Concepts-Plus-38000267">Title Concepts Plus</a>



BBB Rating: <span style="color: red;">F</span>

14 complaints







<em>Bureau's Comments and Analysis of Company's Business:



Callers indicate this company is offering assistance filing homestead exemptions for a $25.00 fee. We suggest careful evaluation of the offer. Homestead declaration forms can be obtained from an office supply store, and once completed, can be sent to the County Recorders office for recording. </em>
 
Is it a prudent thing to do for the cost of a notary and time involved?



If I got slammed with a large medical bill that insurance wouldn't cover and I couldn't afford to pay it, I would choose to not pay that bill and keep paying the mortgage. I feel most would make the choice for shelter. Can/will they come after the equity in your principal residence? That would either result in putting a Line of Credit, a second on the house, or force a sale right? Or does this only come into play in a foreclosure situation?



Should everyone do this? Are there any pitfalls to doing this?
 
[quote author="High Gravity" date=1250744185][quote author="Geotpf" date=1250741495]But if they can still foreclose and take your home, what, as a practical matter, does this actually do?</blockquote>


Here's an example of how the homestead exemption can help you:



Facts:

Your house is worth $500,000.

You owe bank $400,000 secured by t/d on house.

You owe American Express $100,000.



Without exemption, if bank forecloses on you, you'll receive $100,000 which AmEx can take from you so you'll end up with nothing.



With exemption, if bank forecloses on you, you'll receive $100,000, $75,000 of which AmEx can never touch.</blockquote>


So it only really matters if you get foreclosed upon, and the house is worth more than you owe, and you owe other people as well?
 
[quote author="Geotpf" date=1250745387][quote author="High Gravity" date=1250744185][quote author="Geotpf" date=1250741495]But if they can still foreclose and take your home, what, as a practical matter, does this actually do?</blockquote>


Here's an example of how the homestead exemption can help you:



Facts:

Your house is worth $500,000.

You owe bank $400,000 secured by t/d on house.

You owe American Express $100,000.



Without exemption, if <strong>you sell</strong>, you'll receive $100,000 which AmEx can take from you so you'll end up with nothing.



With exemption, if <strong>you sell</strong>, you'll receive $100,000, $75,000 of which AmEx can never touch.</blockquote>


So it only really matters if you get foreclosed upon, and the house is worth more than you owe, and you owe other people as well?</blockquote>


No, it applies when you sell as well. See the changes I made to HG's post above. Although, I don't think a bank is going to foreclose on you for more than what is owed and give you that equity, ever. It applies for when you go to sell the place, or are forced to sell the place because of the judgment.
 
[quote author="SoCal78" date=1250744831]<a href="http://www.la.bbb.org/Business-Report/Title-Concepts-Plus-38000267">Title Concepts Plus</a>



BBB Rating: <span style="color: red;">F</span>

14 complaints







<em>Bureau's Comments and Analysis of Company's Business:



Callers indicate this company is offering assistance filing homestead exemptions for a $25.00 fee. We suggest careful evaluation of the offer. Homestead declaration forms can be obtained from an office supply store, and once completed, can be sent to the County Recorders office for recording. </em></blockquote>


Save your money at the office supply store, get the form for free from the Orange County assessor website:



<a href="http://www.ocgov.com/assessor/exemption1.asp">Exemption form from OC assessor</a>



Correction, the form is no longer available for download from the assessor's website although I'm sure if you call them, they will send the form to you for free.
 
[quote author="graphrix" date=1250736458]I use Firefox, and it has a Google search bar up at the top right of the browser to make <a href="http://www.leginfo.ca.gov/cgi-bin/displaycode?section=ccp&group=00001-01000&file=704.710-704.850">searching for things like this really easy</a>.



Noted. This blog medium is far more entertaining than the book version.
 
[quote author="matt138" date=1250744865]Is it a prudent thing to do for the cost of a notary and time involved?



If I got slammed with a large medical bill that insurance wouldn't cover and I couldn't afford to pay it, I would choose to not pay that bill and keep paying the mortgage. I feel most would make the choice for shelter. Can/will they come after the equity in your principal residence? That would either result in putting a Line of Credit, a second on the house, or force a sale right? Or does this only come into play in a foreclosure situation?



Should everyone do this? Are there any pitfalls to doing this?</blockquote>
It doesn't hurt having a Declaration of Homestead recorded and there are no consequences or pitfalls to having it recorded. If you don't pay your medical bill they'll ship it off to a collections company and ding your credit a little bit. I had the same situation...few thousand that the insurance needed to cover but didn't and I'm still going after them. I didn't pay the bill because I would lose leverage and it went to a collections company and only hurt my credit for 18 months. If the amount is big enough, they may pursue getting a judgment against you at which time you might want to consider filing for Bk chapter 7 or 11 to wipe it out.
 
[quote author="SoCal78" date=1250744831]<a href="http://www.la.bbb.org/Business-Report/Title-Concepts-Plus-38000267">Title Concepts Plus</a>



BBB Rating: <span style="color: red;">F</span>

14 complaints







<em>Bureau's Comments and Analysis of Company's Business:



Callers indicate this company is offering assistance filing homestead exemptions for a $25.00 fee. We suggest careful evaluation of the offer. Homestead declaration forms can be obtained from an office supply store, and once completed, can be sent to the County Recorders office for recording. </em></blockquote>


http://punditkitchen.files.wordpress.com/2009/08/political-pictures-mark-sanford-bullshit-eye.jpg
 
You must log in or register to reply here.
Back
Top