• Donald W. Sieveke, Esq.

California Homestead Exemption Increases to $600,000*

It’s official. With very little publicity, on September 18, 2020, Governor Newsom signed

AB 1885/SB 832, effectively increasing the homestead exemption to $600,000.

*It’s not quite that simple, but almost. Previously, California Code of Civil Procedure §704.730 had a three tiered exemption for a “dwelling”. This provided a $75,000 exemption for a single person, $100,000 for a family unit, and $175,000 for over 65 years old, disabled or low income. This has all been replaced with a single homestead which provides for a minimum of $300,000 and a maximum of $600,000. Husband and wife would share a single exemption. Why the $300,000 versus $600,000? The exemption allows for median single-family home values per county. For example, last year’s median home value in Orange County was $765,497; this means that the $600,000 maximum will apply. The same with Los Angeles County and San Francisco County. Riverside County will have a $400,500 exemption; San Bernardino County $370,215. These amounts will be adjusted annually , beginning on January 1, 2022.

The passage of this law will have enormous effect on homeowners. Even in the case of judgments recorded against the residence, Section 522(f) of the Bankruptcy Code allows for the avoidance of a judicial lien to the extent necessary to allow a full homestead exemption. This avoidance provision applies to all liens except voluntary liens, tax liens and, probably, judgment liens for support.

What is tragic are the many forced sales of homes that have occurred in the last few years that could have been averted by this law.

You may also wish to note that CCP 704.225 now provides that money in a deposit account is now exempt “to the extent necessary for the support of the debtor and his family”.


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