My wife is considering filing for Chapter 7 bankruptcy. Ideally, it will be just her and not me (since her debt is the root of our issues). I have some concerns about protecting our assets. We are California residents and we have a house together that I 100% paid for. She was not involved in the purchase other than getting her name on the title (since we were married). All of the funds used, were funds that I saved before we got married. Is the home an asset that can be sold since her name is on the title?
If so, I’m aware of the Homestead act. According to independent research, California single homeowners can be exempt from 75,000 of the equity and married couples are exempt from $150,000. In doing comps, it looks like we have about $80,000 in equity. Does the $150,000 apply to her filing since she is married, or will we have to file chapter 7 together in order for the $150,000 amount to apply?
To further complicate things, she owns another home that she purchased before we married. I am in no way tied to that house. She rents the house out to a family member for 0 profit. From what I've read, she will only be able to protect her primary residence (the one we own together) and the second home will be fair game for lien. Is this correct?