Massachusetts home buyers have a valuable protection mechanism that is available to them at the time of their home purchase. It is called a Declaration of Homestead.
For most of us, our house is the biggest investment we will make and the largest asset we own. It's also the place we call home. To protect this asset, Massachusetts has established an important safeguard. The Declaration of Homestead provides an easy and inexpensive protection for you in the event of a lawsuit.
According to Massachusetts General Laws, you have a right to file for protection of your property equity under The Homestead Act. This act allows you protection of up to five hundred thousand dollars ($500,000) of the value of your residence against attachment, seizure or execution or judgment from unsecured creditors.
To qualify, the property must be your principal residence. Exemptions to the Homestead protection are: debts for taxes, mortgages used to purchase the home, debts incurred prior to signing the homestead, and debts from the court pursuing child support payments.
There is significance to this protection. If you have filed a Homestead and you happen to be in automobile accident with insufficient insurance to cover your home, you will not be exposed to the extent of $500,000. It also protects you in the case of dog bites, drowning in pools, slips and falls and professional liabilities. While it is not substitute for home insurance, the Homestead protection is effective after any liability insurance is used to pay for any judgments that are related to a particular incident.
You may file for protection whether you are a sole owner, joint tenant, and tenant by the entirety or tenant in common, but the act states that only one owner of a home or one family is eligible for protection on your residence. The word "family" would include a parent and a child or children, a husband and wife and their children or a sole owner.
Home owners who are 62 years of age or older and persons who are disabled are protected to the extent of $500,000 each. Therefore, if two disabled persons or persons above the age of 62 reside in the same home, they should each file a Declaration of Homestead.
The fee for filing is thirty-five dollars ($35). Your closing attorney should make this form available to you at your closing. To be valid, it must be signed, notarized and registered with the Registry of Deeds.
This is great protection for a small price.
Do you have questions about buying a home in the Metrowest area? I would love to talk with you. Please feel free to call me at 508-881-6230 - any time or E-mail me.
Copyright 2009 - Claudette Millette, Broker, Owner, TheBuyersCounsel Learn More about Home Buyer Representation - Greater Boston and MetroWest Massachusetts - Serving Massachusetts Home Buyers Since 1992
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