Homestead: From the Council to the Governor’s Desk

The BBA watched this week as one of its long-standing legislative priorities, homestead reform, was enacted by the Senate.   An Act Relative to the Estate of Homestead is now on the governor’s desk awaiting his signature.  This is good news to the many BBA members who have worked year after year and session after session to see the much needed changes in this area.  This is also good news to the attorneys whose clients have come to them in dire straits, overwhelmed with debt and seeking help to obtain a fresh start.  These reforms are substantial and will provide important consumer protections to homeowners in Massachusetts.  In addition to the consumer protection aspects, the bill will address many of the issues that have caused great difficulty to the courts in interpreting the current homestead statute.

In 2000, a detailed study of the Massachusetts homestead statute appeared in the Boston Bar Journal.  Author Mark W. McCarthy noted that homestead was so badly in need of change that only a complete rewrite would suffice. McCarthy even described the current homestead statute as, “ugly, clumsy, even embarrassing – and it just doesn’t work.”  That same year the BBA filed a homestead bill that was sponsored by then-Senator Robert S. Creedon, Jr. who was also chair of the Joint Committee on the Judiciary.  The BBA’s bill at that time focused on certain aspects of the homestead law including an automatic provision, certain stacking concerns for the elderly or disabled and creditor issues with respect to a homestead. 

Despite our hard work, real progress was not made for years.  While the BBA pushed for its own version of homestead reform, other groups, most notably the Real Estate Bar Association (REBA), were also proposing their version of homestead reform.  It was Senator Creedon who asked the BBA and the REBA to work together on a single bill that would incorporate the reforms that both organizations sought.  The BBA’s dialogue with REBA on homestead yielded good input on ways to improve the bill and led to a multi-year drafting process that resulted in a revised and balanced bill that was filed jointly in the legislature.   Now, an even more improved version of the compromise bill that the BBA and REBA worked on sits on Governor Patrick’s desk. 

Here’s what the current homestead bill will do:

  • Clear up ambiguities and make rules for filing a homestead declaration more logical
  • Protect beneficiaries of trusts
  • A refinancing mortgage will not be able to terminate previously filed homesteads
  • Protect proceeds from insurance or a home sale
  • Protect spouses and co-owners who transfer property amongst themselves
  • Provide protection for manufactured homes

Our work continued as we rallied our members to testify at public hearings, meet with legislators, and contact their local Reps and Senators, and we got pretty close to the finish line at the end of the last legislative session in December 2008.  While we weren’t able to claim victory before the legislature recessed, we did refile the bill to build upon the momentum of the last session. 

Homestead reform will provide concrete and meaningful assistance to citizens in Massachusetts especially low income consumers and the elderly.  Now with homestead poised to pass some ten years after our efforts began, maybe we can get somewhere on updating the personal property exemption laws.

- Kathleen Joyce

Government Relations Director

Boston Bar Association

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