Georgia has just more than doubled the amount of home equity that can be protected in bankruptcy. If a lawyer once told you that you had too much equity to qualify for Chapter 7, this year that math has changed.
What House Bill 1024 Changed
Governor Brian Kemp signed House Bill 1024 into law on May 11, 2026. The bill amended O.C.G.A. § 44-13-100 (a) (1), the statute which sets Georgia’s homestead exemption for bankruptcy filers. From July 1st, 2026, an individual debtor will be able to protect $50,000 of home equity, up from $21,500. For married couples where one spouse is filing and the property is their primary residence, they will be able to protect $100,000, up from $43,000.
That’s a significant jump. Starting July 1, 2031, amounts will also adjust each year for inflation, so exemptions won’t remain frozen for another decade like the old figures did.
The July 1 Deadline Is Not a Suggestion
Bankruptcy exemptions are locked in as of the date of your petition. Not the date you meet with an attorney, or the date you decide to file, but the actual date your case was filed with the U.S. Bankruptcy Court for the Southern District of Georgia, Augusta Division.
File on June 30th, 2026 and you’ll be stuck with the old numbers. File on the 1st of July and the new exemption will apply. For a homeowner who is sitting right on the edge of what the old exemption would have protected, a few weeks could decide whether they keep their house or a trustee will sell it.
Why This Reopens Chapter 7 for Some Augusta Homeowners
Home equity is often the reason why a Chapter 7 case becomes a Chapter 13 case. If your home equity exceeds the exemption amount, a trustee can sell your house, pay you the exempt amount, and distribute the remainder to creditors. Homeowners who want to avoid this outcome end up in a five-year payment plan to keep their house.
The larger exemption changes the calculation for a lot of people. A homeowner who has built up real equity over the years and assumed Chapter 7 is off the table due to it, may now qualify outright. That doesn’t mean that everyone with equity is suddenly a candidate for Chapter 7, though. Income, other assets and the means test still matter and they don’t disappear just because the homestead value went up.
What the Exemption Doesn’t Do
Georgia opted out of federal bankruptcy exemptions years ago. Under 11 U.S.C. § 522(b), states have the choice to make, and Georgia debtors must use the state list of exemptions rather than the federal schedule. You cannot mix and match the two.
The exemption also only applies to a primary residence, a cooperative residence, or a burial plot. It does not apply to rental property or vacation homes. And it does not affect your mortgage balance. If you are behind on payments, the exemption protects the equity, not the loan, so Chapter 13 may still be a better option if what you really need is time to catch up.
If You Were Told No Before, Ask Again
Plenty of Augusta homeowners have been advised in the past few years that Chapter 7 is impractical due to their equity. That advice may no longer be valid. Pull a current valuation of your home, subtract the amount you owe, and compare that number with the new exemption amount.
Timing a filing around the July 1 effective date can be a legitimate strategy. However, it only works if it’s planned correctly and the rest of your case is actually ready to go.
Find Out Where Your Case Stands Under the New Law
At Duncan Bankruptcy Law, we help homeowners in Augusta work through this kind of decision. Whether Chapter 7 makes sense with the larger exemption in place or a Chapter 13 plan fits your situation better, filing for bankruptcy in Georgia comes with its own set of rules and getting the timing right matters. If home equity has kept you out of Chapter 7 in the past, it’s worth considering a second look. Contact us at Duncan Bankruptcy law today to discuss your options.
