Massachusetts Homesteads Cannot Be Attached

27 May Massachusetts Homesteads Cannot Be Attached

It’s obvious, in hindsight. If home equity is protected by a Massachusetts homestead, then a creditor should not be able to put a pre-judgment attachment lien on that home equity.

(A Massachusetts homestead automatically protect $125,000 of home equity from creditor liens. It protects $500,000 of home equity if there is a recorded declaration. It gets complicated with multiple owners.)

The thinking had been – mine included – that a pre-judgment attachment lien would only attach to future appreciation of home equity, and only when that future appreciation of home equity exceeds the homestead-protected amount. On the other hand, one could sell the home and demand the proceeds free of the lien, if the proceeds were under the homestead limits.

Judge Kenneth J. Fiandaca of the Boston Municipal Court ruled differently. Based on recent changes to the Massachusetts homestead law, he denied a request for a prejudgment attachment lien on home equity protected by a homestead because there was no unprotected home equity at the time of the request.

It’s a good decision. It’s sound reasoning. And it’s a position that’s been taken by Jordan L. Shapiro, one of the authors of Collection Law, 3d (Vols. 48-48A, Massachusetts Practice Series)ever since the 2011 changes to the state homestead laws.

Next question – does the creditor’s attorney who makes the request violate the Fair Debt Collection Practices Act? ($1,000 statutory damages, by the way). I’ll let you know. 🙂

The logic should extend to a judgment execution lien, putting the burden on the creditor to show at the time of recording that there is home equity exceeding the amount protected by the Massachusetts homestead. Otherwise, this should be another violation of the Fair Debt Collection Practices Act and there is slander of title to the real estate.

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L. Jed Berliner, Western & Central Massachusetts Consumer Lawyer

L. Jed Berliner practices exclusively in consumer bankruptcy, foreclosure defense, and related consumer protection litigation such as credit card defenses and suing debt collectors. He established his Springfield, MA practice in 1988. Attorney Berliner is a regular and active contributor to the Bankruptcy Law Network, the Bankruptcy Roundtable, and the National Association of Consumer Bankruptcy Attorneys, three specialized consumer bankruptcy forums on the Internet, and is an informal mentor to regional practitioners. He is recognized by his peers as an expert in consumer bankruptcy issues. He thoroughly enjoys being rated "excellent" in his client surveys.

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