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MontGuide 199815 Using a Homestead Declaration to Protect Your Home From Creditors Revised May 2012 1.

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Presentation on theme: "MontGuide 199815 Using a Homestead Declaration to Protect Your Home From Creditors Revised May 2012 1."— Presentation transcript:

1 MontGuide Using a Homestead Declaration to Protect Your Home From Creditors Revised May

2 Marsha A. Goetting Ph.D., CFP ®, CFCS Professor & Extension Family Economics Specialist Dept. of Agricultural Economics & Economics Keri D. Hayes Publications Assistant Dept. of Agricultural Economics & Economics 2

3 Protection Now up to $250,000 in value of a home against most creditor claims 3

4 Prior Law Exempt Property  $40,000  $60,000  $100,000 4

5 If previously filed declaration Don’t have to refile to receive $250,000 protection 5

6 What is a Homestead? House, condo, townhouse, manufactured home or mobile home Land on which it sits Any improvements, fences, etc. 6

7 Manufactured Home or Mobile Home Owner does not have to own the land the mobile home/manufactured home is sitting on 7

8 Homestead Must be person’s primary residence 8

9 Not Eligible Doesn’t include:  Home furnishings  Appliances 9

10 Legal Value Amount appearing on the last completed county assessment roll From county treasurer’s office 10

11 Example: Joe’s house:  Assessed value $80,000  Mortgage Balance $50,000  Protection $30,000 11

12 Example: Doug & Laura’s house:  Assessed value = $275,000  Mortgage Balance = $ 10,000  Remaining Balance = $265,000 **** BUT, Maximum Protection is $250,000 12

13 Who Should Sign? Both spouses should sign the declaration Must be notarized 13

14 Who Should Sign? A spouse may acquire interest in property at marriage unless there is a premarital agreement 14

15 Tenants in Common Each own individual interest Can only file for portion of undivided interest 15

16 Tenants in Common: Jack and Jill  Each can file for ½ of $250,000 or $125,000 16

17 17 Standard Form MSU Extension:  extensionecon/ financialmgtpublications.html

18 Homestead Declaration Form A document that does not meet the requirements is considered Non-standard  Montana Code Annotated  §

19 Undo a Declaration Declaration of Abandonment form  extensionecon/ financialmgtpublications.ht ml 19

20 Record Clerk and Recorder’s office In the county where the home is located 20

21 Recording Fees Standard form  $7.00 per page Non-standard form  $7.00 per page plus $

22 No Protection Creditor obtains judgment against the homeowner before declaration is filed 22

23 No Protection Against liens for  Services  Supplies 23

24 No Protection Failure to pay the mortgage 24

25 No Protection Bankruptcy, unless filed before bankruptcy was declared 25

26 No Protection Medicaid Estate & Recovery Program Lien on home of homeowner in a nursing home whose medical costs were paid by Medicaid 26

27 MontGuide on the Web Search “Homestead Declaration” 27

28 MontGuide Using a Homestead Declaration to Protect Your Home From Creditors Revised May


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