Homestead exemption
Overview
Creditor
A creditor is a party that has a claim to the services of a second party. It is a person or institution to whom money is owed. The first party, in general, has provided some property or service to the second party under the assumption that the second party will return an equivalent property or...
s, and circumstances arising from the death of the homeowner spouse. Laws are found in state
U.S. state
A U.S. state is any one of the 50 federated states of the United States of America that share sovereignty with the federal government. Because of this shared sovereignty, an American is a citizen both of the federal entity and of his or her state of domicile. Four states use the official title of...
statutes or constitution
Constitution
A constitution is a set of fundamental principles or established precedents according to which a state or other organization is governed. These rules together make up, i.e. constitute, what the entity is...
al provisions which exist in many states in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
.
Homestead exemption laws typically have four primary features:
- They prevent the forced saleForced saleA Forced Sale of Real Estate is an action that taken in a civil court forcing the owners to sell the property at issue and divide the profits. A forced sale would be the result of a petition to partition action.- Why forced sales occur :...
of a home to meet the demands of creditorCreditorA creditor is a party that has a claim to the services of a second party. It is a person or institution to whom money is owed. The first party, in general, has provided some property or service to the second party under the assumption that the second party will return an equivalent property or...
s (however, in most cases homestead exemptions do not apply to forced sales to satisfy mortgages, mechanics lienMechanics lienA mechanic's lien is a security interest in the title to property for the benefit of those who have supplied labor or materials that improve the property. The lien exists for both real property and personal property. In the realm of real property, it is called by various names, including,...
s, or sales to pay property taxes); - They provide the surviving spouse with shelter;
- They provide an exemption from property taxProperty taxA property tax is an ad valorem levy on the value of property that the owner is required to pay. The tax is levied by the governing authority of the jurisdiction in which the property is located; it may be paid to a national government, a federated state or a municipality...
es which can be applied to a homeHomeA home is a place of residence or refuge. When it refers to a building, it is usually a place in which an individual or a family can rest and store personal property. Most modern-day households contain sanitary facilities and a means of preparing food. Animals have their own homes as well, either...
. - Allows a tax-exempt homeowner to vote on property tax increases to homeowners over the threshold via bond or millage requests.
For purposes of these statutes, a homestead is the one primary residence
Primary residence
A person's primary residence is the dwelling where they usually live, typically a house or an apartment. A person can only have one primary residence at any given time, though they may share the residence with other people...
of a person, and no other exemption can be claimed on any other property anywhere, even outside the boundaries of the jurisdiction
Jurisdiction
Jurisdiction is the practical authority granted to a formally constituted legal body or to a political leader to deal with and make pronouncements on legal matters and, by implication, to administer justice within a defined area of responsibility...
where the exemption is claimed.
In some states, homestead protection is automatic.
Unanswered Questions
