Law Office of Allan E. Dunaway, PLC

What is Kentucky’s homestead exemption?

Most states, including Kentucky, have something called a homestead protection law.

Under this law, people who have filed for bankruptcy can keep a portion of their real property, which is referred to as the homestead, exempt from creditors.

The purpose of homestead protection laws is to prevent people from losing their homes during difficult financial times. Without this law, people who declared bankruptcy may end up homeless. The law is intended to prevent this extreme situation. 

How exactly does this work? Let’s say that you have fallen behind on your mortgage payments. If you decide to file for bankruptcy, you can claim the maximum $5,000 exemption on your home’s equity. Even though you owe money to creditors, this exemption can prohibit the creditors from seizing your home. You can remain living in your home while the bankruptcy process is sorted out.

In addition to the homestead exemption, debtors in Kentucky can also exempt certain personal property from creditors during bankruptcy. Again, there is a limit on the amount of personal property that can be exempt. You can protect up to $3,000 of jewelry, clothing, ornaments, and household furnishings. Plus, you can exempt a motor vehicle and its accessories of up to $2,500 in value. If you are a farmer, you can also protect up to $3,000 of tools, equipment, and livestock.

Keep in mind that these homestead exemptions are provided by state law. There are also federal homestead exemptions, but you cannot claim exemptions under both federal and state law. You must choose one or the other.

If you have questions about the homestead exemption, consider speaking with an experienced personal bankruptcy attorney. Every case is different. An attorney can help you decide what choices are the best for you and your family. 

No Comments

Leave a comment
Comment Information
Contact the Firm

Get Sound Advice In A Free Consultation

For sound bankruptcy advice you can count on, from a skilled lawyer who truly cares about your future, contact the Louisville Law Office of Allan E. Dunaway, PLC. We have two convenient locations: Louisville, Kentucky, and Jeffersonville, Indiana. Our main office in Louisville is located off the beaten path so you won't have to deal with downtown traffic and can pull right up to our door and walk right in.

Call us at 502-785-1005, or send an email message. Our law firm welcomes the opportunity to serve you in any way we can.

If for some reason personal bankruptcy is not for you, if you do not qualify for the Chapter 7 approach via the "means test" and Chapter 13 reorganization is not the answer, Allan E. Dunaway works hard to inform you of other appropriate means of debt settlement that suits your unique needs.

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Kentucky Office

Indiana Office

714 Lyndon Lane
Suite 4
Louisville, KY 40222

Phone: 502-785-1005
Fax: 502-412-2258
Louisville Law Office Map

530 East Court Avenue
Jeffersonville, IN 47130

Phone: 502-785-1005
Fax: 502-412-2258
Jeffersonville Law Office Map