Information You Need to Know: Massachusetts New Homestead Act

According to Robert Bevans, Esq., partner at Topkins & Bevans, “The homestead law which was previously in effect (the “Old Homestead Law”) has caused more debate among real estate practitioners than almost any other statute. Confusion seemed to be the only consensus that was ever reached when construing the Old Homestead Law. Basic controversial issues such as, “Was a mortgage release a release of the homestead?”; “Was a spouse required to sign a deed even if the spouse was a non-title holder?”; “What effect did the filing of a subsequent homestead have on an existing homestead?” The statute which goes into effect on March 16, 2011, (the “New Homestead Act”) seems to have been enacted to resolve these, and other, issues.”  –Excerpt from the Topkins & Bevans blog: The Massachusetts Homestead Law Takes Effect

Mass Legal Services compiled some important highlights of the Massachusetts Homestead Protection Law, as well as provided the informational links below:

• The Homestead Act allows homeowners in Massachusetts to protect their principal residence from unsecured creditors, up to a certain amount
• Existing homesteads recorded prior to March 16, 2011 remain valid
• There is an automatic $125,000 homestead; no recordation of a homestead declaration is needed for this protection
• Homeowners receive a $500,000 homestead protection by recording a homestead declaration; all owners must sign to gain the protection
• All owners must occupy or intend to occupy the home as principal residence
• Owners who are elderly or disabled should each file a homestead under section 2 of the new law to gain maximum protection (beyond $500,000)
• 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 is needed
• As under prior law, homestead declarations are subject to mortgages executed by all owners.

For more information about the New Homestead Act, click on the links below:

• Link to the new law
• Questions and Answers about the Homestead Act (downloadable brochure, prepared by the Massachusetts Registry of Deeds)
• Declaration of Homestead Form (fillable PDF, prepared by the Massachusetts Registry of Deeds)
• Declaration of Homestead Form for Homes Owned by Trustees (fillable PDF, prepared by the Massachusetts Registry of Deeds)
• Massachusetts Law About Homestead (Massachusetts Trial Court Library)