#614 How Lawsuits Can Take Away Your Home (And How to Stop It!)

Mar 20, 2026

A deep dive into how lawsuits can threaten your home equity and when your house is actually at risk. State homestead rules and tenancy by the entirety protections are compared. Creative defenses like equity stripping, HELOC liens, LLCs, and domestic asset protection trusts are explored. Common pitfalls such as risky transfers, gifting property, and overreliance on umbrella insurance are highlighted.

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INSIGHT

Smoke And Mirrors Don’t Withstand Litigation Discovery

Surface-level tactics (e.g., anonymous LLC mortgages) can deter casual searches but fail under discovery.
Mark J. Kohler cautions judges can void sham transfers once litigation progresses.

ADVICE

Get An Undrawn HELOC To Create A Defensive Lien

Obtain a HELOC and leave it undrawn to place a legitimate lien on title without incurring large debt.
Mark J. Kohler notes banks record the lien up to the maximum even if you never withdraw funds, deterring plaintiffs.

INSIGHT

Tenancy By The Entirety Protects Married Couples’ Homes

Tenancy by the entirety can shield a married couple's home from a creditor suing only one spouse.
Mark J. Kohler explains only about half the states fully recognize this protection, so marital title matters by state.

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If you got sued tomorrow, could you lose your home? In this episode of the Main Street Business Podcast, Mark J. Kohler and Mat Sorensen break down the real risks to your home equity — and the smart strategies you can use right now to protect it before it’s too late. From homestead exemptions to equity stripping, this is essential knowledge every homeowner and investor needs to understand.

We dive into how different states protect your home, when creditors can (and can’t) touch your equity, and how tools like HELOCs, retirement accounts, and domestic asset protection trusts can create powerful layers of defense. You’ll also learn the common mistakes people make — like relying too heavily on umbrella insurance or transferring assets incorrectly — and how to avoid them.

If you're serious about protecting your wealth, minimizing risk, and building a solid financial foundation, this episode gives you a practical roadmap to do it right. Make sure to subscribe, like, and share this with someone who needs to safeguard their assets!

You'll learn:

How lawsuits can impact your home equity — and when your house is actually at risk
What the homestead exemption is and how it protects you (state-by-state differences)
When and how creditors can force the sale of your home
The strategy behind “equity stripping” and how it can reduce your exposure
How HELOCs and liens can be used as a defensive asset protection tool
Where to safely move equity so it’s harder for creditors to reach
The pros and cons of domestic asset protection trusts vs. offshore trusts
Why umbrella insurance may not protect you the way you think
How to structure LLCs and entities to contain liability and protect personal assets
Common asset protection mistakes that could cost you everything

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