Texas Homestead Exemptions in Bankruptcy

In  a Texas bankruptcy, the exemption for a homestead in Texas is limited to $125,000 if the property was acquired within the previous 1215 day (3.3 years). The cap is not applicable to any interest transferred from a debtor’s previous principal residence (which was acquired prior to the beginning of such 1215-day period).

The value of the Texas homestead exemption is reduced by any addition to the value brought about on account of a disposition of nonexempt property made by the debtor (made with the intent to hinder, delay, or defraud creditors) during the 10 years prior to the bankruptcy filing.

An absolute $125,000 homestead cap applies if either:

  • the court determines that the debtor has beeen convicted of a felony demonstrating that the filing of the case was a abuse of the provision of the Bankruptcy Code; or
  • the debtor owes a debt arising from a violation of federal or state securities laws, fiduciary fraud, racketeering, or crimes or intentional torts that caused serious bodily injury or death in the preceeding 5 years. NOTE: This limitation is inapplicable if the homestead property is “reasonably necessary for the support of the debtor and any dependent of the debtor.”

This information is very important for any Texas resident that is under the pressure of an impending Texas home foreclosure. Call our Dallas Bankruptcy law office or Fort Worth law office for complete information on all state and federal bankruptcy exemptions.

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