The Homestead Exemption
What It Could Mean To Your Family
The Homestead Exemption or the "Declaration of Estate
of Homestead" provides protection and security to homeowners,
eliminating the threat that the equity in their principal
residence could be exposed to satisfy common debts or obligations.
This is a simple mechanism, yet most homeowners are not
familiar with it, and it is an underutilized law that allows
homeowners to protect certain equity in their principal
residence from the majority of creditors.
Massachusetts General Laws Chapter 188, §
1-10 as originally written allowed an owner of real estate,
for the benefit of themselves or their family, to exempt
Five Hundred Thousand Dollars ($500,000.00) in home equity
from attachment, levy on execution, or sale for payment.
In other words, it eliminates the threat that the equity
in your principal residence could be exposed to satisfy
"common debts" or obligations.
As of March 16, 2011, the
Massachusetts Homestead Act completely rewrites
Chapter 188, § 1-10 providing home owners more modern
Here are some of the important changes to
the new Homestead Declaration Law:
- Existing homesteads remain valid.
- There is an automatic $125,000 homestead;
no recordation of a homestead declaration is needed for
- Homeowners receive a $500,000 homestead protection by
recording a homestead declaration; all owners must sign
to gain the protection. There is a one-time $35.00 recording
- All owners must occupy or intend to occupy the home
as principal residence.
- Owners who are elderly or disabled should file a homestead
under section 2 of the new law to gain maximum protection.
- Under new law, both spouses can record a homestead.
- Property held in trust can be homesteaded.
- Every homeowner who has refinanced his/her mortgage
in the last several years should record a new homestead
declaration since many refinancing mortgages contained
a waiver of homestead rights.
- If a married couple has divorced or separated, each
should re-examine whether a new homestead declaration
- As under prior law, homestead declarations are subject
to mortgages executed by all owners.
There are other changes in the new law, but
these are some of the important ones. I suggest that any
homeowner contemplating a Declaration of Estate of Homestead
for a principal residence should consult with their attorney
with any questions. Under the new Massachusetts Homestead
Act closing attorneys or mortgage settlement agents are
required to obtain written proof that they have informed
borrowers of their right to declare a homestead. The attorney
or settlement agent must also discuss the difference between
an automatic and a declared homestead that provides additional
Here is a link to the new Massachusetts
Declaration of Estate of Homestead Law.
To learn more about the NEW
Homestead Exemption Law in Massachusetts, follow this link
Homestead Act Question & Answers. Changes to the
Q&A are currently being made to reflect the new Law.