Expansions to the Massachusetts Homestead Protection Act take effect on March 16, 2011. The Homestead Act offers protections to homeowners against creditors. It does not, however, protect homeowners from any taxes, claims, liens, mortgage-holders, judgments, and prior debts.
According to the existing Homestead Act, a Buyer of a property should “declare” their Homestead protections at the Registry of Deeds when a Buyer closes on that property. There is also a fee involved. The amended Homestead Act offers an automatic Homestead Protection in the amount of $125,000 against creditor claims for their principal residence. However, if a Buyer does files Homestead protections, a homeowner is protected up to $500,000.
Additionally, under the existing Homestead Act, only one spouse may file for Homestead protection. The amended law allows both spouses to file. If a homeowner refinances their property, there is also no longer a need to “re-declare” Homestead protection.
Also, one attorney has advised, “(the Homestead Act) will provide protection up to $1,000,000 if there are two owners either 62 years or older or disabled and both join in the declaration of homestead.” The amended Homestead Act also provides protection for homes kept in trusts and properties with 2 to 4 units.
Click here for more information about the Homestead Act.
If you would like more information about the Homestead Act, contact your attorney.