The National Association of Consumer Bankruptcy Lawyers (NACBA) lobbies Congress to create laws favorable to consumer debtors. In 2022 they had several successes:
CALIFORNIA 2022
S.B.1099: Signed into law on September 28, 2022. The bill goes into effect January 1, 2023. Highlights include:
- “Ride through” option restored for vehicles (no more repos for failure to reaffirm).
- Homes protected from trustees selling them due to post-petition appreciation where had been fully protected by the homestead exemption on the petition date. Such appreciation will also be exempt.
- Spouses living separate or apart from a non-filing spouse will no longer require a waiver from the non-filing spouse to utilize our alternate set of exemptions (which are usually more favorable for non-homeowners).
- Increases the motor vehicle exemption to $7,500 for both sets of exemptions.
- Creates new exemption fully exempting vehicles converted for use by a disabled debtor, spouse or dependent.
- Creates new exemption for up to an aggregate amount up to $7,500 for accrued or unused vacation pay, sick leave, family leave or wages.
- Creates new exemption for payments from settlement agreements arising from debtor’s employment (e.g. workplace harassment).
- Creates new exemption for alimony, maintenance and support which was not previously included in the set of exemptions which includes the homestead exemption.
CALIFORNIA 2021
- A.B. 1885: increases the homestead exemption in the event of a bankruptcy to $300,000 or the countywide median sale price of a single-family home in the calendar year prior to the year when the judgement debtor claims the exemption. It caps the amount at $600,000 and, beginning in January 2022, adjusts it annually for inflation based on the change in the California Consumer Price Index.
- Signed into law on September 18, 2020.
COLORADO 2022
- S.B. 22-086:
- Increases the homestead exemption from $75,000 to $250,000 if the homestead is occupied as a home by an owner of the home or an owner’s family;
- and from $105,000 to $350,000 if the homestead is occupied as a home by an owner who is elderly or disabled, an owner’s spouse who is elderly or disabled, or an owner’s dependent who is elderly or disabled.
- Homestead exemption covers non-traditional housing;
- Reinstates bank account exemption up to $2,500;
- increases vehicle exemption to $12,000/$25,000 [60+ or disabled];
- Increases Household Goods exemption to $6,000/person;
- Increases disability benefit exemption to $5,000/mo;
- Increases farm equipment/livestock exemption to $100,000;
- Adds exemption for future economic stimulus payments;
- Adds firearm/hunting equipment exemption [up to $1,000];
- Adds exemption for health savings accounts [HSAs];
- Adds exemption for funds reserved for taxes & insurance on some reverse mortgages; and
- keeps exemptions on unemployment & child support even if funds commingled.
- Signed into law on April 7, 2022. Bill takes effect upon Governor’s signature.
CONNECTICUT 2021
- H.B. 6466:
- Raises the homestead exemption to $250,000,
- motor vehicle exemption to $7,000, and
- creates an exemption for the cash surrender value of life insurance policies.
- Signed into law on July 12, 2021.
VIRGINIA 2020
- H.B. 790: Makes various changes to homestead exemptions, including providing that the official schedule of property claimed exempt filed with the United States Bankruptcy Court in a bankruptcy proceeding constitutes a sufficient writing to exempt such real and personal property from creditor process. The bill also provides that a householder may hold exempt from creditor process real or personal property that the householder or his dependent uses as a principal residence not exceeding $25,000 in value.
- Signed into law on March 12, 2020.
WASHINGTON 2021
- S.B. 5408: raises the Washington Homestead Exemption to the greater of $125,000 or the county median sale price of a single family home.
- Signed into law on May 12, 2021.