Depending on your state of residence, the "homestead" exemption may protect some or all of your interest in the house and the adjoining land that you occupy as a home. Creditors may not be able to force the sale of homestead property. The amount of the homestead exemption that is available is set by state statute.
If the equity in your residence exceeds the exemption allowed, one way to decrease it is to borrow against the property. You can use the proceeds of the loan to acquire additional exempt property. This strategy enables you to maximize the exemption available for a dwelling or a declared homestead.
Some state homestead examples are:
(1) California - between $50,000 and $100,000 (depending on the circumstances).
(2) Florida - up to 160 acres of contiguous land together with the improvements thereon if the homestead is located outside a municipality, or up to one-half acre of land together with the residence located thereon if the homestead is within a municipality.
(3) Texas - up to 200 acres of land, in one or more parcels, together with improvements thereon if the homestead is not located in a town or city, or not more than one acre of land, together with improvements thereon, if the homestead is located in a city, town or village. In Texas it does not matter if your homestead is worth $10,000 or $10 million.