DECLARATIONS OF HOMESTEAD Every Homeowner should have one! by Peter Mark Heintzelman, Esq. Copyright 2000, all rights reserved Visit My Webpage: Heintzelaw.com. Upon the purchase of a principal residence in Massachusetts, all homeowners should consider recording a Declaration of Homestead, to take advantage of the statutory shelter of your housing equity from certain claims of future, often unforeseeable creditors. Normally, you should file your Homestead Declaration with your deed at the registry of deeds, or anytime thereafter. There are advantages to filing it sooner than later. If your attorney or the bank's attorney does not provide you with the Declaration of Homestead Form, often at an additional fee, you may be able to pick up a copy of the form from the registry of deed's desk. Currently, after signing the form in front of a notary public, it costs $10 to record the Homestead in the registry of deeds having jurisdiction over your home. Its one of the best values in asset protection planning. You can only declare a Homestead on the property of your principal residence. You cannot declare a Homestead in realty that you own not in your own name, but in the name of an entity, like a corporation or realty trust, even if the property is your principal residence. You must have your name on the deed as the owner, or at least, a co-owner. Once a Homestead is declared under any law in force upon the recording of the homestead, shall continue to be held and enjoyed notwithstanding any future attempted repeal of the law. Exemptions from certian creditor claims start at $100,000, and increase to $200,000.00, for the declarant who is elderly or disabled. Make sure you don't forget to ask to record a Homestead when you purchase your own residence! More Specific Details About the Declaration Of Homestead: Who May Declare the Homestead? An estate of homestead, to the extent of $100,000.00 dollars, in the land and buildings, may be acquired pursuant to law by an owner or owners of a home or one or all who rightfully possess the premise by lease or otherwise and who occupy or intend to occupy said home as a principal residence. Elderly or disabled persons, shall be protected against attachment, seizure or execution of judgment to the extent of two hundred thousand dollars; provided, however, that such person has filed an elderly or disabled person's declaration of homestead protection; and, provided further, that such person occupies or intends to occupy such home as his principal residence. A disabled person's declaration of homestead protection shall be accompanied by other documentation required of the statute, to substantiate the disability. For the purposes of the Declaration of Homestead, a disabled person is defined as an individual who has any medically determinable permanent physical or mental impairment which would meet the disability requirements for supplemental security income under the provisions of 42 USC 1382c(a)(3)(A) and (C). An owner of a home shall include a sole owner, joint tenant, tenant by the entirety or tenant in common; provided, that only one owner may acquire an estate of homestead in any such home for the benefit of his family; and provided further, that an estate of homestead may be acquired on only one principal residence for the benefit of a family. For the purposes of this chapter, the word "family" shall include either a parent and child or children, a husband and wife and their children, if any, or a sole owner. What Does a Declaration of Homestead Protect Me From or Not? No estate of homestead shall affect a mortgage, lien or other encumbrance previously existing. An estate of homestead shall, however, be exempt from the laws of conveyance, descent, devise, attachment, levy on execution and sale for payment of debts or legacies except in the following cases - sale for taxes; - for a debt contracted prior to the acquisition of said estate of homestead; - for a debt contracted for the purchase of said home; - upon an execution issued from the probate court to enforce its judgment that a spouse pay a certain amount weekly or otherwise for the support of a spouse or minor children, where buildings on land not owned by the owner of a homestead estate are attached, levied upon or sold for the ground rent of the lot whereon they stand; - upon an execution issued from a court of competent jurisdiction to enforce its judgment based upon fraud, mistake, duress, undue influence or lack of capacity. Set off of homestead estate to insolvent debtor: If the property of a debtor is assigned under the laws relative to insolvent debtors, and such debtor claims, and it appears to the court wherein the proceedings in insolvency are pending, that he is entitled to hold a part thereof as a homestead and that the property in which such estate of homestead exists is of greater value than fifty thousand dollars, the court shall cause the property to be appraised by three disinterested appraisers, one of whom shall be appointed by the insolvent, one by the assignee and the third by the court; or if either the assignee or insolvent neglects to appoint, the court shall appoint for him. The appraisers shall be sworn faithfully and impartially to appraise the property, and shall appraise and set off an estate of homestead therein to the insolvent debtor in the manner prescribed in section eighteen of chapter two hundred and thirty-six in case of a judgment debtor; and the residue shall vest in and be disposed of by the assignee in the same manner as property which is not exempt by law from levy on execution. How Do I Declare a Homestead? To acquire an estate of homestead in real property, the fact that it is designed to be held as such shall be set forth in the deed of conveyance by which the property is acquired; or, after the title has been acquired, such design may be declared by a writing duly signed, sealed and acknowledged and recorded in the registry of deeds for the county or district in which the property is situated. To acquire a claim of homestead in a manufactured home, the fact that it is designed to be held as such shall be set forth in a writing duly signed, sealed and acknowledged and filed at the city or town clerk's office in the city or town in which the manufactured home is located. Be careful if you have previously recorded another Homestead, because the acquisition of a new estate or claim of homestead shall defeat and discharge any such previous estate. The Value of the Homestead to your Family upon your Death: The estate of homestead existing at the death of a person holding a homestead shall continue for the benefit of the surviving spouse and minor children, and shall be held and enjoyed by them, if one of them or a purchaser under section eight occupies the premises, until the youngest unmarried child is eighteen and until the marriage or death of the spouse; and if a widow or minor children are entitled to an estate of homestead as provided herein, it may be set off to them in the same manner as dower. But all the right, title and interest of the deceased in the premises in which such estate exists, except the estate of homestead thus continued, shall be subject to the laws relating to devise, descent, dower and sale for the payment of debts and legacies. When Does a Declaration of Homestead Terminate? An estate of homestead may be terminated during the lifetime of the owner by either (1) a deed conveying the property in which an estate of homestead exists, signed by the owner and the owner's spouse, if any, which does not specifically reserve said estate of homestead; or (2) by a release of the estate of homestead, duly signed, sealed and acknowledged by the owner and the owner's spouse, if any, and recorded in the registry of deeds for the county or district in which the property is located. |
