Ins and Outs of the Massachusetts Homestead Law
Updated: May 31
The personal liability insurance on your homeowners, automobile, and umbrella policies is designed to financially protect you if you are responsible for personal or property damage to a third party. But what happens when that coverage is not enough? There are many situations where you may not have the appropriate coverage, or where you may get sued for more than the amount of coverage that you carry. It is a very real possibility that your assets, including your house, would be vulnerable in a large personal injury settlement. The Massachusetts Homestead Act helps protect up to $500,000 of the value of a home against third-party claims.
At Acacia Insurance we strongly recommend that, in addition to appropriate liability insurance coverage, all Massachusetts home and property owners file a Declaration of Homestead.
How to file for Homestead
Below is information on what the Homestead is, what it covers, and how to file the appropriate paperwork.
What is the Homestead Act?
The Massachusetts Homestead Act is a law under which a homeowner is protected by an Estate of Homestead. A homestead estate provides limited protection of the value of the home, up to $500,000, against unsecured creditor claims. The Homestead Act is Massachusetts General Laws (MGL) Chapter 188.
The homestead estate is designed to protect home ownership from execution and forced sale, so long as the owner or covered family member occupies or intends to occupy the property as his or her principal place of residence.
Section 4 of MGL Ch. 188 provides an automatic exemption available to everyone who owns a home and who occupies or intends to occupy the home as his or her principal residence. This exemption is for $125,000.00. Filing a written Declaration of Homestead at the Registry of Deeds for the county where the home is located increases that amount to $500,000.00. There are two types of Homestead Declaration. The standard form of homestead declaration is filed under Section 3 of the Homestead Act. The second form is for elderly or disabled people and is filed under Section 2.
Section 2: An elderly (age 62 or older) or disabled person may declare a Homestead under Section 2. The Section 2 homestead benefit does not extend to other family members in general, but each qualified owner should file.
Section 3: A Homestead Declaration under Section 3 must be filed by the owners of a home for the benefit of their family. For property held in trust the trustee or trustees must file.
Under both sections the property must be occupied or intended to be occupied as a principal residence. The extent of the homestead protection is $500,000 under Section 3 but may be higher under Section 2.
All Homesteads must be filed in the county in which the residence is located. Each county has slightly different requirements for filing the Homestead so it is important to contact the Registry of Deeds for your county directly. Contact information for each Massachusetts Registry can be found here.
What does the Homestead Act do?
Upon filing a Declaration of Homestead the real property that serves as an individuals principal residence is protected against attachment, levy on execution and sale for payment of debts for legacies, to satisfy non-exempted debts, to the extent of $500,000 for a regular Homestead. The extent of the Homestead protection may be higher for an elderly or disabled person.
What are exempted debts? Or What debts are not protected by a Homestead Declaration?
The following are exempt from Homestead protection: federal, state and local taxes and liens; mortgages contracted for purchase of the home and most other mortgages; debts and encumbrances existing prior to the filing of the Declaration of Homestead; probate court executions for spousal or child support; attachments on land not owned by the owner of the owner of the homestead and court ordered executions in cases of fraud, mistake, duress, undue influence, and lack of capacity.
What does the Homestead Act mean by a "Disabled Person?"
A disabled person is defined as an individual having a permanent physical or mental impairment meeting the disability requirement for supplemental social security. If filing a disabled person’s homestead declaration, you must attach to the Declaration of Homestead form a certified copy of a disability letter issued by the United States Social Security Administration, or a letter signed by a licensed physician registered with the Massachusetts Board of Registration in Medicine that states the declarant is disabled as defined in 42 USC 1382 (a) (3) (A) and (C).
Do I have to file a new Homestead every time I re-mortgage or take out a second mortgage or home equity loan?
No. The new language which went into effect March 16, 2011 states that homesteads are subordinate to mortgages and that no language in a mortgage can affect a homestead except to subordinate it.
How much does it cost to record a Homestead?
In Massachusetts, the fee is $36.00.
Can (a) trustee(s) file for Homestead protection?
The Massachusetts Land Court has determined that registered land held in a trust cannot be given Homestead protection. There is no such limitation regarding recorded land.
Will my Homestead protect my home from being taken if I go into a nursing home?
No. A lien imposed by the Office of Medicaid as a result of payment for Medicaid benefits, is a governmental lien and is exempt from Homestead protection.
Can I file a Homestead if my primary residence is a mobile or manufactured home?
Yes. The Registry of Deeds has been authorized by the new law to accept a declaration of homestead for a mobile or manufactured home.
How do I file a Declaration of Homestead?
The Declaration of Homestead may be filed in person or by mail. To file by mail in Norfolk County, mail the completed notarized declaration, together with a check for the amount of the fee ($36.00) payable to: Norfolk County Registry of Deeds
Mail to: William P. O’Donnell, Register
Norfolk County Registry of Deeds
ATTN: HOMESTEAD REQUEST
649 High Street
Dedham, MA 02026-1831
Ready to learn more?
Acacia Insurance has been helping to make the unexpected uneventful since 1988, and we look forward to working with you. Please contact us with questions and for additional information.