Is it possible for a creditor to force me to sell my home?

January 1, 2022 – the Arizona legislature decided to change more than 100 years of protection for homeowners.  It is going to take many years to understand what they did and how it effects all homeowners.  Bottom line – creditors with recorded judgments can now pursue equity in a homestead property, with specific limitations.  See ARS Section 33-964 for the latest version of the law.

See also, ARS 33-1105. Sale by judgment creditor of property subject to homestead exemption: A judgment creditor other than a mortgagee or beneficiary under a trust deed may elect to sell by judicial sale as specified in title 12 the property in which the judgment debtor has a homestead under section 33-1101, subsection A, provided that the judgment debtor’s interest in the property shall exceed the sum of the judgment debtor’s homestead plus the amount of any consensual liens on the property having priority to the judgment. A bid shall not be accepted by the officer in charge of a sale under this section which does not exceed the amount of the judgment debtor’s homestead plus the amount of any consensual liens on the property having a priority to the judgment plus the costs of the sale allowable under title 12. After receipt of a sufficient bid, the officer shall sell the property. From the proceeds, the officer shall first pay the amount of the homestead to the judgment debtor plus the amount of any consensual liens on the property having a priority to the judgment and then pay the costs of the sale. The remaining proceeds shall be applied in accordance with the provisions of ARS section 12-1562, subsection A. If the sale does not occur, either because of voluntary abandonment by the judgment creditor or because no sufficient bid is made, the judgment creditor may not charge any costs or attorney fees incurred in connection with the sale against the judgment debtor by addition to the judgment or otherwise.

See also: Evans v. Young, 135 Ariz. 447, 661 P.2d 1148 (Ariz.App.1983) (held that foreclosure is available to a judgment creditor who wishes to subject judgment debtor’s homestead property to execution and forced sale, but judgment creditor must first satisfy statutory appraisal procedures, and value of homestead property must exceed value of homestead exception over and above all liens and encumbrances).