Homestead: Overview

Homestead laws vary greatly from state to state. Homestead rights in most states are an exemption from the claims of creditors, not an encumbrance on title. However, the homestead right or exemption requires special treatment to satisfy the law, and the homestead right must be treated as though it constitutes a kind of encumbrance which must be waived or released to validate a transaction. Basically, the purpose of a homestead exemption is to protect the family home, but the protection takes many forms. In some states, the homestead is protected against forced sale by certain creditors. In many states, a surviving spouse is allowed to use the homestead free from the claims of creditors. Some states protect spouses by requiring that both spouses join in the conveyance or encumbrance of the homestead, even if title is vested in just one of the spouses. A homestead exemption is allowed in some jurisdictions for purposes of ad valorem taxes, with a percentage of the appraised value of the homestead exempted from the taxes


Generally, homestead rights are created by state constitutions, state statutes, the federal bankruptcy laws, and federal legislation. The applicable law must be studied to determine what constitutes the homestead, what protection is afforded, and what limitations, exclusions, and requirements affect the homestead rights. Federal tax liens do attach against homestead property, in all states.