Homesteads and Why You Need One

November 1, 2019

What is a Homestead under Massachusetts Law?

If you’re a Massachusetts homeowner, the Massachusetts Homestead Act protects equity up to certain amounts in your home from being liquidated to pay off liens. You must live in your home as a principal residence to qualify for homesteading. Mutually agreed to secured debt like a mortgage or a home equity loan are not effected by the Homestead Declaration.

All principal residences in Massachusetts are automatically given some homestead protection following the passage of a 2011 revision to the Homestead Act. This Act automatically conveys Homestead protection of up to $125,000 of the equity value of your home. Equity is the fair market value of your home less any secured debt owed (i.e. mortgages, liens). However, for the added benefit and little cost, it makes more sense to file a Homestead Declaration for your principal residence, to increase the Homestead protection to $500,000.  However, the Homestead rules may apply differently in Bankruptcy than under Massachusetts law.

 Any of the owners of a home can file the Declaration of Homestead at the Registry of Deeds for their county such as those in Taunton, Brockton, New Bedford, Fall River, Plymouth, and Worcester. Any kind of home can qualify as a Homestead, including single-family residences, multi-family dwellings (up to 4 units), condominiums, mobile homes and manufactured homes.

 There are three types of homesteads protections under Massachusetts law:


Automatic Homestead

Even if you fail to file a Declaration of Homestead, you are still automatically protected by the homestead law up for up to $125,000 in equity. Like all homesteads, you must live in the home as the principal residence.


Declared Homestead

By filing a Declaration of Homestead, you extend your protection from 125,000 to $500,000 in equity. It must be filed with the local Registry of Deeds in your community.

You and your spouse must both sign the Homestead Declaration if you are both owners. In the event of the death of the homeowner, the homestead protection will continue for the spouse and minor children as long as they keep the house as their principal residence.


Homestead for Elderly or Disabled Persons

There is a special provision of the Massachusetts Homestead law that applies to homeowners who are age 62 or older, or who are disabled. A disabled homeowner must be eligible for Social Security’s disability benefits. Elderly and disabled homeowners must file a Homestead Declaration with the Registry of Deeds.

Homestead protection does not apply to Medicaid liens incurred for nursing facility care.


Benefits of Homestead Protection under Massachusetts Law

The Homestead Act protects the home you live in from being sold to pay off debts up to the amount of equity you qualify for ($125,000 under automatic protection, $500,000 with a Declaration of Homestead, or up to $1,000,000 for elderly or disabled Homestead protection).

Homestead protection does not apply to:

  • State and federal tax liens
  • Debts incurred before the home was protected by the Homestead Act (unless you file for bankruptcy)
  • Mortgages, second mortgages and loans secured by the home (unless a junior lien quaifies for cramdown in a Chapter 13 bankruptcy)
  • Judicial liens (unless you strip them off in bankruptcy)
  • Child support and spousal support debts
  • Homestead protection does not apply to Medicaid liens incurred for nursing facility care


Applying for Homestead Protection in Massachusetts

Protection up to $125,000 is automatic – all homeowners in Massachusetts now have this protection.

For $500,000 homestead protection, you have to file a Homestead Declaration in the Registry of Deeds for your county. There are county registries in Brockton, Taunton, Fall River, New Bedford, Plymouth, Worcester and others. Your declaration must be notarized by a notary public. There is a $35 filing fee payable to the Commonwealth of Massachusetts.

Under the current Homestead Law, your closing attorney is required to notify you about your right to homestead protection when you are buying your house and many people elect to file their homestead declaration at that time.

The bottom line is that a homestead gives you a lot of protection for very little cost (presently the filing fee is $35.00 excluding legal fees to prepare the document). Homesteads are governed by the state and therefore not every state has a homestead available. Those that do allow homesteads each determine the amount that can be protected.


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