Maybe you’ve seen it on the news, maybe you’ve heard it from a friend, or maybe you’re going through it yourself. Losing a home due to debt or bankruptcy can be heartbreaking. Fortunately, the Mountain State has what are known as homestead protection laws that could protect your home in the event of a bankruptcy.

Under these statutes, a person in debt may designate a specific amount of real or personal property, referred to as a "homestead," to be off limits to some creditors. Here is a quick introduction homestead laws in West Virginia.

Homestead Statutes in West Virginia

State homestead laws vary in the amount of acreage or value of property they allow to be designated as a homestead. West Virginia statutes limit the homestead exemption to $5,000 of real estate and $1,000 of personal possessions. The details of West Virginia’s homestead laws are highlighted listed.

Exceptions to Homestead Protections

West Virginia’s homestead exemptions are a good start, but they might not protect your home against every debt. There are four general exceptions to the homestead rule:

• If there was a pre-existing lien on the property before the establishment of homestead;
• If the homestead property was specifically pledged as credit for a mortgage;
• If you owe past due taxes to the State of West Virginia and West Virginia counties or municipalities; or
• If you owe money to mechanics, contractors, or builders for work performed in repairing or improving the property.

Additionally, homestead protections are state laws, and therefore may not apply to federal income tax liens. If there is an overlap or a conflict of state and federal law, the Constitution’s Supremacy Clause, demands that federal law will apply. Even so, the Internal Revenue Service (IRS) is generally reluctant to foreclose on a person’s home to collect on a tax debt and will usually only get involved if a homestead property is sold off or mortgaged before the federal tax lien has expired.

More Resources for Homestead Laws in West Virginia

State homestead exemptions can be confusing. FindLaw’s section on Homestead Protections can provide you with additional articles and resources on this topic. You can also consult with a West Virginia bankruptcy attorney or a West Virginia real estate attorney in your area if you would like legal help regarding a homestead issue.