Definition of the Homestead act in relation to a person dying without a will
The Homestead protects an individual's primary dwelling from liens and executions up to a certain value, ($125k). It also gives the owner a tax benefit. If a person dies and leaves a spouse, the deceased's homestead (valued at $125,000 or less) can be transferred to the surviving spouse, without the spouse having to pay the debts of the deceased before the transfer can be finalized.
Read more: Vermont's Homestead Act | eHow.com http://www.ehow.com/facts_6721577_vermont_s-homestead-act.html#ixzz2AYFbw85w
This really has nothing to do with the intestate code. You can find out more about intestacy, here: http://www.mystatewill.com/statutes/vt_law.php
The intestacy code does not apply to assets which are jointly owned, so if the property is jointly owned, the probate would not be necessary, at all.
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A homestead act allows a spouse to claim a statutory value of a primary residence free from all creditors and mortgages. If there is any value in the home above the statutory amount, the creditor can only foreclose on the balance. The creditor can foreclose on their interested portion of the home, but cannot foreclose on the spouse's interest. Thus any purchaser will own the share as a tenant in common with the spouse. Since title is thus burdened, the foreclosure value is extremely low (since most investors or buyers will not purchase a home as a tenant in common).
Thus your position in negotiating the mortgage improves - as you cannot be evicted from the home as a tenant in common. However, rents are still owed on the bank's portion of the home - which can create additional legal issues in the future. But the ability to negotiate is still improved
Matthew Johnson phone# 206.747.0313 is licensed in the State of Washington and performs bankruptcy, short sale negotiations, and estate planning in Whatcom, Skagit, Snohomish, King and Pierce counties. The response does not constitute specific legal advice, which would require a full inquiry by the attorney into the complete background of the facts and circumstances surrounding this matter; rather, it is intended to be general legal information based on the limited information provided by the inquirer; it This response also does not constitute the establishment of an attorney-client relationship, which can only be established after a conflict of interest evaluation is completed, your case is accepted, and a fee agreement is signed. Johnson Legal Group, PLLC
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Estate Planning Attorney
The Homestead Act essentially secures a portion of the equity (defined by the statute) in a home from creditors. The laws of intestacy provide how an estate will be distributed when someone dies without a valid will.
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