A person's home is their castle, subject of course to real estate taxes, assessments, mortgages, and creditors threatening to attach the home to satisfy a money judgment.
Filing a simple form with the Registry of Deeds won't help protect your home against the tax collector or your mortgage lender, but it can help shield your home from the claims of creditors for debts you incur after the purchase of your home.
The form is called a Declaration of Homestead and, for people under the age of 62, it exempts the first $100,000 of the equity in your home from your creditors. For the elderly (over the age of 62) and disabled, the protection increases to $200,000. Unlike many other states, Massachusetts does not provide automatic homestead protection when one purchases a home. It is necessary for a homeowner to execute a Declaration of Homestead and record it at the appropriate Registry of Deeds for it to become effective.
Attorney Ed Smith of the Massachusetts Conveyancers Association said that the legislature almost passed an automatic Homestead Act in 1994, but no legislation is presently pending.
Therefore, it is up to the homeowner to take action and record the Declaration form. If one is elderly or disabled, a slightly different form must be used.
The homestead protection is available only for one's principal residence and, except for the elderly and disabled homestead, only one owner may acquire a homestead for the benefit of his or her family. Therefore, the Declaration of Homestead should not be signed by both spouses.
A separate elderly, or disabled homestead may be filed by any person who qualifies. Therefore, if both spouses are over the age of 62, they may each file an elderly Declaration of Homestead. A "disabled person" under the statute is defined as an individual who has any medically determinable permanent physical or mental impairment which would meet the disability requirements for supplemental security income . . .". The filing of such a homestead, must be accompanied by an original or certified copy of a disability award letter issued by the Social Security Administration, or a letter signed by a licensed physician certifying that the person filing the Homestead Declaration meets those disability requirements.
In addition to protecting the home against creditors, the Homestead Declaration may increase the bankruptcy exemption in the home to either $100,000 or $200,000, which could be of significant benefit to a homeowner who must file for bankruptcy protection.
Every homeowner should take advantage of the Homestead Statutes. Most attorneys will prepare and record a Homestead Declaration for a nominal fee. All you have to do is provide your attorney with a copy of your deed and they will prepare and record at the Registry. If you want to go directly to the Registry of Deeds, forms are available for you to fill out and record on the spot. The recording fee is $10.00.
Take a moment and have your Declaration of Homestead prepared. Until Massachusetts passes a law to give homeowners automatic protection, the burden is on you to protect your home.