Effective April 1, 2013, Ohio’s homestead exemption was amended to allow a homeowner to exempt up to $132,900 of equity in his or her home. See, Ohio Revised Code Section 2329.66(A)(1)(b). This is important to contractors, subcontractors and material suppliers that have filed a judgment lien against a residence because the resident’s homestead exemption may have priority over the judgment lien up to $132,900. Prior to the April 1, 2013 amendment, the maximum Ohio homestead exemption available to homeowners was $22,200. One Ohio Appellate Court has recently concluded that in a residential foreclosure case, the homestead exemption amount in effect when the decree of foreclosure is filed controls over the homestead exemption amount when the judgment lien was filed against the residence. See, First National Bank of Pennsylvania v. Jones, 11th Dist No. 2013-T-0083, 2014-Ohio-746. This should cause judgment lienholders to think twice before they file a foreclosure action upon a judgment lien that has been filed against a residence.
Moreover, three Northern District of Ohio Bankruptcy Courts have recently concluded that the date that a homeowner files a bankruptcy petition, not the date that a judgment lien is filed against the homeowner’s residence, is the controlling date for determining what amount of a homestead exemption that the homeowner may claim. See, In re Depascale, 496 B.R. 860 (Bankr. N.D. Ohio 2013); In re Pursley, 2014 WL 293557 (Bankr. N.D. Ohio 2014); In re Mitchell, 2014 WL 1725819 (Bank. N.D. Ohio 2014). This means that for any bankruptcy petition filed on or after April 1, 2013, the homeowner may be able to avoid a judgment lien against his or her home in the bankruptcy case by claiming a homestead exemption up to $132,900.
Contact Attorney Alan P. DiGirolamo for more information.
