Chime® is a financial technology company, not a bank. Banking services, credit, and debit card provided by The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC.

What Is a Homestead Exemption?

Chime Team • April 1, 2024

Homestead Exemption

The homestead exemption is a legal provision designed to protect the value of a home from property taxes, creditors, and circumstances that arise from the death of the homeowner’s spouse or the declaration of bankruptcy. Essentially, it offers homeowners a way to shield a portion of their home’s value, ensuring that they are not left completely vulnerable in times of financial distress or bereavement.

Examples of a homestead exemption include a homeowner who is facing bankruptcy but is able to keep their home because the homestead exemption protects a certain amount of the home’s equity from being seized by creditors. Similarly, in the event of the death of a spouse, the surviving spouse can benefit from the homestead exemption to maintain ownership of their home, despite potential claims against the estate.

The importance of the homestead exemption lies in its role as a critical financial safeguard for homeowners. Many states offer a homestead exemption that reduces the taxable value of a home, directly lowering the homeowner’s property tax bill. By providing a buffer against the total loss of a homeowner’s equity in times of financial hardship or upon the death of a spouse, the homestead exemption helps ensure that people have a stable place to live. This protection can be particularly vital for the elderly or those on fixed incomes, for whom their home is not only their most significant asset but also a fundamental part of their financial security.

In order to receive a homestead exemption, you should first research the specific homestead exemption laws and requirements in your state, as provisions and protections vary widely. Next, you can file the necessary paperwork with your local tax assessor’s office to claim the exemption. Finally, review their estate plans to understand how the homestead exemption may affect the inheritance of your property.

Homestead exemptions have a major impact on community stability and homeowner rights. By providing financial and legal protections for homeowners, the homestead exemption supports the larger goal of promoting homeownership as a means of achieving financial stability and building wealth.

By protecting homeowners in time of need, the homestead exemption serves as an essential tool that offers both financial relief in the form of reduced property taxes and crucial legal protections against creditors and estate claims. Understanding and utilizing the homestead exemption as part of a comprehensive personal financial planning and asset protection strategy can ensure homeowners can secure their property rights and financial well-being.

Chime® is a financial technology company, not a bank. Banking services are provided by The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC. The Chime Visa® Debit Card and the Chime Credit Builder Visa® Credit Card are issued by The Bancorp Bank, N.A. or Stride Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa debit and credit cards are accepted. Please see the back of your Card for its issuing bank.

While Chime doesn’t issue personal checkbooks to write checks, Chime Checkbook gives you the freedom to send checks to anyone, anytime, from anywhere. See your issuing bank’s Deposit Account Agreement for full Chime Checkbook details.

By clicking on some of the links above, you will leave the Chime website and be directed to a third-party website. The privacy practices of those third parties may differ from those of Chime. We recommend you review the privacy statements of those third party websites, as Chime is not responsible for those third parties' privacy or security practices.

Third-party trademarks referenced for informational purposes only; no endorsements implied.

‡ SpotMe® for Credit Builder is an optional, no interest/no fee overdraft line of credit tied to the Secured Deposit Account. SpotMe on Debit is an optional, no fee service attached to your Chime Checking Account (individually or collectively, “SpotMe”). Eligibility for SpotMe requires $200 or more in qualifying direct deposits to your Chime Checking Account each month.

Opinions, advice, services, or other information or content expressed or contributed here by customers, users, or others, are those of the respective author(s) or contributor(s) and do not necessarily state or reflect those of The Bancorp Bank, N.A. and Stride Bank, N.A. (“Banks”). Banks are not responsible for the accuracy of any content provided by author(s) or contributor(s).

Address: 101 California Street, Floor 5, San Francisco, CA 94111, United States.

No customer support available at HQ. Customer support details available on the website.

© 2013-2024 Chime Financial, Inc. All rights reserved.