Is it possible to have a homestead exemption of $300,000?
Boston, MA |
I was considering bankruptcy, and had a local attorney check my Declaration of Homestead exemption, and according to the courts, my exemption is $300,000. I had always thought that it was only $125,000.
I don't practice law in your state, but this link from the Massachusetts Trial Court Law Libraries said that you automatically get an exemption of $125,000 and can protect up to $500,000 with a declared homestead: http://www.lawlib.state.ma.us/subject/about/homestead.html. You should confirm thiswiht a local bankruptcy attorney.
First, the firm is a debt relief agency according to the U.S. Bankruptcy Code. We help people file for bankruptcy. We also do other stuff and we do it well, but Congress wants me to post this notice.
Second, nothing on this site is legal advice. You are not my client unless you enter into a written agreement signed by you and me.
The automatic homestead, meaning no Declaration of Homestead has been recorded, is $125,000. If you record a Declaration of Homestead you get an $500,000 exemption. Before 2004, the Declaration of Homestead was $300,00. So you probably filed a Declaration of Homestead pre-2004 and are entitled to an exception of at least that amount.
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You really need to indicate how long you have lived in Boston from this point going back before you can rely on any answers on exemptions that have been provided! That is crucial. Lets assume you have lived there the last 5 years straight...then no problem. THus, you might just add those facts to your stated question please so the attorneys know for sure their advice will be accurate as the laws changed back in 2005 concerning that issue. Good luck.
Your Homestead exemption would not count in bankruptcy. Bankruptcy is a purposeful and voluntary action whereby you GIVE interest in your assets. It is akin to your Homestead not protecting you from foreclosure. You are entitled to the exemption allowed by the Bankruptcy code.
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Your exemption is based upon whether you have recorded a Declaration of Homestead on your home at your local registry of deeds, lived in your property for the requisite residency requirement, and consider it to be your primary residence. You say that "[a]ccording to the courts, my exemption is $300,000" but in actuality it has nothing to do with a court determination. If you have recorded a homestead on your property, if you file a bankruptcy and use the Massachusetts state exemptions, you will be entitled to up to $500,000.00 of equity in your property for purposes of exemption. For example, if you owe $250,000.00 to a mortgage company (only - and have no other secured mortgage, liens, or other title issues) and your house is worth $750,000.00, provided you meet the eligibility requirements to file a bankruptcy you will be entitled to exempt (keep) the $500,000.00 of equity that would otherwise be up for grabs based on the fact that it is your primary residence. The Commonwealth created this homestead exemption to protect the homes of its citizens from creditors, and if you fit within that class and criteria, you can have a homestead exemption of $10,000, $300,000 or even $500,000.00. If you have any questions about this, feel free to call my office for a free consultation to discuss your options.
It is very important that you speak with an experienced bankruptcy attorney before relying on any homestead exemption amounts. No one has pointed out to you that if you have not owned and resided in the property for at least 1215 days (approximately 3 years and 3 months) prior to filing bankruptcy your homestead is limited to approximately $146,000.00. Also, if you have been convicted of a felony or securities fraud within 10 years prior to filing bankruptcy your homestead may be limited. Without filing an actual declaration of homestead at the registry of deeds you automatically get the $125,000.00 exemption. If you filed one at the registry of deeds and even if you filed it years ago you are entitled to the full $500,000.00 exemption. Presently all owners may file a homestead. It is important that an experienced attorney examine your recorded homestead. I have seen older homestead, before multiple owners where allowed to file, that had both husband and wife's name and are not valid. Again, you really should consult someone experienced and knowledgeable in both bankruptcy and homesteads otherwise your home could be subject to being sold to pay your debts.