Protecting Successive Florida Homesteads in Bankruptcy

A reader asked me to address a situation where a Florida resident owned a homestead property for 30 months and sold the house. Within a reasonable time after the sale, he bought a new homestead where he then lived for 45 months prior to filing bankruptcy. The question is whether the reader would in bankruptcy get Florida’s unlimited homestead protection which is available for people who have owned their homestead for 40 months or more.

The new bankruptcy law specifically addresses this situation. The law provides that previous ownership of a homestead in the same state can be tacked on the time of ownership of the existing homestead. So, if this person first house and transfers the net proceeds into the second house he will be deemed to reside 45 months in his Florida homestead when he files bankruptcy. Again, both homesteads must be located in Florida to combine time residence.

posted by Jonathan Alper, bankruptcy and asset protection attorney, Orlando, Florida