Potential complicaion to future Ch 7??

[Cali]

CA has 2 different types of exemptions to pick from.

The 2nd on lets you use homestead for real or personal property. Any unused homestead can be used for any property and can be combined with the wildcard.

[CaraMia007]

A few new questions re our Ch 7...

Thanks again to both of you Cali & Help! I am beginning to think that it might be best to let both houses go in the BK whether we move or not... PITI on the house we were hoping to keep is about $2,400/mo, we can rent a 3 BR house for about $1,000 a month where we live now or $1,275/mo in Washington if we move.

Questions:
1) If we are going to let both houses go, can we still use the mortgage payment on the primary residence on the means test? We could keep the payment current using the proceeds from DH's truck.

2) If we bought DH a "new" truck that is worth more than the car exemption allowance, can we use the homestead exemption to cover the difference? (Assuming that we will be letting both houses go)

3) I see that any 1 household item can only be valued at $450... do we add up the total of all items and apply that to the Homestead exemption? Or are those two separate issues?

Thanks again!

[Help!]

1) Yes
2) According to Cali, yes. But if you are letting the houses go in the BK and do not intend to use either as your primary residence after BK I don't see how you could be entitled to the homestead exemption. You could use the wildcard exemption to cover the equity in the new truck, though.
3) Same issue as 2.

[CaraMia007]

Ugh! I'm confused again now! I was thinking that if we give up both homes we can go under System 2 for California and use the 17k homestead exemption for personal property... I'm off to look at the exemptions section to try to understand this!

[Cali]

System 2:

Homestead is 20,725$

Wildcard is 1100$ plus any unused homestead amount. Total max of wildcard can be 21,825$.

Motor Vehicles exemptions 3,300$.

Ugh! I'm confused again now! I was thinking that if we give up both homes we can go under System 2 for California and use the 17k homestead exemption for personal property... I'm off to look at the exemptions section to try to understand this!

[Cali]

Any unused portion of homestead may be applied to any property. So if you don't own a house you can use the full homestead amount plus wildcard for any property.

1) Yes
2) According to Cali, yes. But if you are letting the houses go in the BK and do not intend to use either as your primary residence after BK I don't see how you could be entitled to the homestead exemption. You could use the wildcard exemption to cover the equity in the new truck, though.
3) Same issue as 2.

[Help!]

We were told we were unable to do this in our case because the home we owned in our former state would not be our primary residence and we intended to surrender it through BK. Initial consultations with BK attorneys should be free, so I'd take advantage of those and get as many questions like these answered as possible. Maybe you can get a phone consultation with someone in WA and compare the benefits/drawbacks to filing in either state.

[Help!]

Ok - Cali's reply got me thinking about whether or not I was overlooking an exemption I could have used. In order to use the full amount (at least in WA), it has to be your residence. If not, you can at least apply part of it:

http://www.rgslegal.us/Bankruptcy/WashingtonBankruptcyExemptions/tabid/72/Default.aspx

Maybe you are better off filing in CA ASAP since you can say this property is your residence and can use the full exemption...