New York’s homestead exemption swings by nearly two-to-one depending on which county your home sits in — a detail that directly changes how much a Chapter 13 filer’s plan has to pay unsecured creditors. Combined with a genuine choice between state and federal exemption systems, New York gives filers more moving parts to get right than almost any other state’s repayment-plan process.
How Chapter 13 Works in New York
You file a petition and propose a repayment plan lasting three to five years. A standing Chapter 13 trustee collects your monthly payment and distributes it — secured debts first, then priority claims, then whatever’s left goes to unsecured creditors. You keep all your property throughout, and remaining qualifying unsecured debt is discharged when the plan completes.
The exemptions you claim set your plan’s liquidation test floor — the minimum unsecured creditors must receive. In New York, that floor depends heavily on which exemption system you choose and, for homeowners, which county your property is in.
How the County-Tiered Homestead Exemption Affects Your Plan
New York’s homestead exemption is Tiered by county: $204,825 in Kings, Queens, New York, Bronx, Richmond, Nassau, Suffolk, Rockland, Westchester, and Putnam counties; $170,700 in Dutchess, Albany, Columbia, Orange, Saratoga, and Ulster counties; roughly $102,425 in all remaining counties. Married couples who both own the home and file jointly can double the applicable amount. The homestead amount depends on the county where the property sits, not where you file. Figures adjust roughly every three years under CPLR 5206. A filer with identical home equity in two different counties can end up with very different liquidation test floors purely because of the county line — one of the first things to confirm before your attorney drafts a plan.
Should You Use New York or Federal Exemptions?
If you’ve lived in New York for at least two years, you can choose either New York’s exemption list or the federal exemptions, but not a combination of both. Homeowners in high-equity counties usually do better under New York’s own homestead exemption. Renters and filers with modest home equity sometimes come out ahead under the federal system’s wildcard provision, which can lower the liquidation test floor and reduce what unsecured creditors are owed through the plan.
Why New York Filers End Up in Chapter 13
Mortgage arrears are the most common driver, especially valuable to resolve given how much equity many New York homeowners have built. Income above the means test threshold is the second major factor — New York’s median income figures are high enough that many filers with substantial income still land in Chapter 13 rather than qualifying for Chapter 7.
Do You Qualify for Chapter 7 Instead? The Means Test
New York’s current median income figures:
- 1 person: $73,272
- 2 people: $92,902
- 3 people: $115,579
- 4 people: $139,040
- Each additional person: add $11,100
Filers above the median for their household size generally must commit to a five-year plan; those below can propose three years.
Mortgage Cure in New York
Filing Chapter 13 triggers the automatic stay, halting foreclosure immediately. The plan spreads mortgage arrears across its three-to-five-year duration while you resume regular payments going forward — a significant protection given how much equity is often at stake in New York’s higher-value housing markets.
Vehicle Treatment and Cramdown
New York exempts $5,500 in equity in one vehicle, or up to $13,625 if the vehicle is equipped for a disabled filer's use. If your car loan was originated far enough before filing and the vehicle is worth less than the remaining balance, the plan can cram the loan down to the vehicle’s current market value at a court-approved interest rate.
Which Federal District Do You File In?
New York has four federal bankruptcy districts. Eastern District (Brooklyn) - Kings, Queens, Richmond, Nassau, Suffolk
Southern District (Manhattan/White Plains) - Bronx, New York, Dutchess, Orange, Putnam, Rockland, Sullivan, Westchester
Western District (Buffalo/Rochester) - Erie, Monroe, and western counties
Northern District (Albany/Utica) - Albany, Saratoga, and the remaining upstate counties
Which district you file in depends on where you’ve lived for most of the past six months.
How Much Does a Chapter 13 Attorney Cost in New York?
Chapter 13 attorney fees in New York typically run $4,100 to $7,500, with fees toward the higher end concentrated in New York City. That’s on top of the 313 federal filing fee, usually built into the plan itself.
Common Mistakes New York Filers Make
Assuming the homestead exemption is the same statewide. The nearly two-to-one gap between counties catches filers off guard, especially recent movers within the state.
Not comparing state versus federal exemptions. This decision genuinely changes the liquidation test floor in New York more than in most states.
Filing in the wrong district based on a work address instead of a residential one.
Missing required tax filings during the plan, which can trigger a motion to dismiss.
A Realistic Example
Consider a filer we’ll call Yvonne, living in Westchester County, part of New York’s highest homestead tier. She works in healthcare administration and fell behind on her mortgage after a period of reduced hours. She owns a home with about $180,000 in equity.
Westchester’s homestead tier of $204,825 fully covers her equity, keeping her liquidation test floor low on the housing side despite substantial home value. Her attorney confirms New York’s own exemptions are the better choice given her equity level and county.
Her income lands above New York’s median for a household of two, so she commits to a five-year plan. The mortgage arrears are spread across the plan while she resumes regular payments. Five years later, the mortgage is current and the remaining unsecured debt is discharged.
Frequently Asked Questions About Chapter 13 Bankruptcy in New York
Can Chapter 13 stop foreclosure in New York?
Yes. Filing triggers the automatic stay, which halts foreclosure immediately. Your plan then spreads the mortgage arrears across three to five years while you resume regular payments.
Does the New York homestead exemption depend on where I live?
Yes, specifically on the county where the property is located. New York uses a three-tier system, with New York City and nearby suburban counties receiving the highest protection and most upstate counties receiving the lowest.
Should I use New York or federal exemptions in Chapter 13?
It depends on what you own. Homeowners with significant equity usually do better under New York’s own exemptions. Renters and filers with less equity sometimes do better under the federal system’s wildcard. You must have lived in New York at least two years to choose either.
How long does a Chapter 13 plan last in New York?
Three to five years. Filers with household income above New York’s median for their household size generally must propose a five-year plan; those below can propose three years.
What is the New York bankruptcy means test income limit?
It depends on household size and updates periodically. Current thresholds are roughly $73,272 for one person, $92,902 for two, $115,579 for three, and $139,040 for four, with $11,100 added per additional person.
Which bankruptcy district do I file in if I live in New York City?
Manhattan and the Bronx fall under the Southern District. Brooklyn, Queens, and Staten Island fall under the Eastern District, along with Nassau and Suffolk counties on Long Island.
Where to Verify the Details
New York’s exemption statutes are published in CPLR §§ 5205 and 5206. For current means test figures, check the U.S. Trustee Program website. District-specific filing information is available through the Eastern, Southern, Northern, and Western District bankruptcy courts.
Alternatives to Chapter 13 in New York
If you pass the means test and don’t need to cure a mortgage, our Chapter 7 guide for New York explains how straight liquidation might discharge your debt faster. For a state with a flat, unlimited homestead exemption instead of a county-tiered one, see our Chapter 13 guide for Florida. For a look at broader debt trends, see our average debt data for Illinois.
Last reviewed by American Debt Guide Editorial Team. Figures on this page reflect New York bankruptcy exemption amounts and federal filing data as of July 2026.