New Massachusetts Homestead Law

On December 16, 2010, Governor Patrick signed into law important modifications to the Massachusetts homestead law.

Under the new homestead law, every homeowner is automatically entitled to a homestead exemption of $125,000.00. The exemption, which generally protects a homeowner’s equity in his or her home from claims of creditors, can be increased to $500,000.00 by the filing of a written declaration of homestead with the Registry of Deeds.

In addition, the new law clears some lingering ambiguities of the homestead law. Specifically, the new law clarifies that the refinancing of a mortgage should not affect a homestead declaration, and it bars mortgage lenders from requiring a waiver or release of homestead in connection with a mortgage transaction. Further, the new law clarifies a discrepancy of whether a homestead declaration would be effective if a home is owned in a trust by providing that a homestead declaration is, in fact, effective if the home is owned in a trust.

The new law also permits homestead protection for multi-family homes and allows a homestead declaration to pass automatically from a deceased homeowner to the surviving spouse or co-owner.

It should be noted that, as under the former homestead law, the exemption does not provide protect against all creditors’ claims. For example, claims for taxes and nursing home or long term care costs are excluded from the protection.