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2011©Cengage Learning. All Rights Reserved.
Homesteads
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NATURE AND AMOUNT
Homestead protects a portion of a debtor’s family home from creditors.
Two types Declared homestead Dwelling house homestead
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NATURE AND AMOUNT
Purpose is to preserve the family by protecting them from a forced sale of their home.
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Amount Family homestead for $100,000 Age 65 or disabled homestead up to
$175,000 Regular homestead covers up to $75,000
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Equity Protection
Ninety Percent Limitation Selling Procedure Effect of Increase
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Equity Protection
Creditors Protected Homestead Recorded First Judgment Recorded First
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PRIORITIES
Recording Priority 1. Mechanic’s liens 2. Deeds of trust 3. Federal tax liens
Dwelling House Exemption
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Effect
A homestead protects a debtor’s equity from creditors.
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CREATION
Creation Requirements
Identity of Declarant Residency Stated Property Description Signed by the Declarant
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CREATION
Creation Requirements Identity of Declarant
Residency Stated Property Description Signed by the Declarant
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CREATION
Creation Requirements Identity of Declarant Residency Stated
Property Description Signed by the Declarant
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CREATION
Creation Requirements Identity of Declarant Residency Stated Property Description
Signed by the Declarant
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TERMINATION
Homesteads can be terminated only by prescribed methods.
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TERMINATION
A formal declaration of abandonment, properly executed and recorded, will terminate the homestead.
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TERMINATION
Alternatively, a homestead can be terminated by a homeowner recording a new homestead of a different property.
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