In Massachusetts, the amount of protection you have against creditors making claims against your home depends on whether you have an automatic or a declared homestead exemption. The Homestead Act (General Laws Chapter 188) is a law that provides limited protection of up to $500,000 of the value of a Massachusetts home against unsecured creditor claims when a declaration has been filed. Unsecured creditor claims are loans that are not "secured" by property, such as a house or car. When a declaration of homestead is not filed with the Registry of Deeds in the county or district where the home is located, only an automatic homestead protection of $125,000 will apply. This automatic protection is not enough to protect the full value of most people's homes. If you need advice about the Homestead Act and filing a declaration, the experienced Boston real estate attorneys at Pulgini & Norton can offer thorough guidance.
Filing a Declaration of HomesteadHomeowners can protect a principal residence by filing a declaration of homestead. This includes homeowners who own a mobile or manufactured home as a principal residence. A principal residence is one that serves as a primary dwelling for a homeowner and his or her family. For the purposes of the declaration, it does not matter if the home owner is a life tenant, a sole owner, a joint tenant, a tenant by the entirety, a tenant in common, or simply a beneficiary of a trust. All of these types of owners can file a declaration.
Whether the home is a freestanding house or a mobile home, you will need to file at the Registry of Deeds where the home is located. The registry is required to file your declaration even if there is no deed for the property on record.
A declaration will protect $500,000 of value in the home from seizure, attachment, levy, or sale for the payment of debts and an execution of judgment. There is greater protection (up to $1 million) for those who are disabled or who are 62 years old or older. It provides a benefit to each of the named owners and family members who occupy the home as a primary residence. It also protects spouses who are not listed as owners. For example, if an unmarried individual declares a homestead and later marries, the protection for the home extends to the new spouse.
Generally, if you hold your home as a joint tenant or as a tenant by the entirety, the homestead exemption is whole and held by both your co-owner and you. However, if there are more than two joint tenant owners, in certain cases you may add $250,000 to the exemption amount. When there are multiple owners holding as trust beneficiaries or tenants in common, the homestead exemption is distributed between the owners in amounts equal to their proportion of ownership.
Contact a Knowledgeable Boston Property Transactions AttorneyFor many people, the purchase of a home is among the most important and expensive purchases of their lives. For a home purchase in the Boston area, the real estate lawyers at Pulgini & Norton are available to advise you. We also assist clients in Cambridge, Quincy, Weymouth, and other cities in Massachusetts. Call us at 781-843-2200 or contact us via our online form for a free consultation.