Living Trusts & Homestead Exemptions in Bankruptcy in Texas
By Pamela Stewart, Attorney at Law on Oct 13, 2007 in General Bankruptcy Information
In Texas, if you have a Living Trust and your home is owned by the Living Trust, you need to transfer it back to yourself before you file bankruptcy. Otherwise, you will lose your homestead exemption in bankruptcy. The Texas Property Code allows your living trust to claim your homestead exemption outside of bankruptcy. However, if you file for bankruptcy with the house still owned by trust, you are unable to claim the homestead exemption because the trust owns the home – not you.
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