Homestead Protection Suggested Reading

A Homestead can protect your home equity from general creditor claims.

HOMESTEAD ACT (NRS 115)

We’ve had many inquiries lately regarding the act of filing a homestead on a primary residence as protection from credit cards debt. The Nevada Homestead Act does(NRS 115) not protect a homeowner from any debt that was voluntarily incurred. This category includes mortgage financing, credit card debt, auto financing, lines of credit and Federal Tax Liability. Following is an article that offers a brief explanation as well as links to print the required homestead document.

Homeowner’s are advised to seek competent legal counsel regarding the ramifications of filing a Declaration of Homestead. This article is intended as a public service and not legal advice.

I’ve heard I should Homestead my house … what does that mean?

The Nevada Homestead Act today doesn’t mean you can squat on 160 acres of public land and eventually own it, rather it is a means to protect equity in your home against seizure, forced sale by general creditor claims, and judgments that might be entered against you. The amount of protection was recently increased in Nevada to $550,000.

The Nevada Homestead Act is one of the gifts the Constitution of the State of Nevada gives to homeowners and yet it’s amazing how few people actually take advantage of it. Most of the people we speak with don't even know it exists.

Here’s how it works: You must currently own or be buying your home, town home, condominium or mobile home in order to file a Declaration of Homestead. The home must be your principle residence, not a rental or investment property. It doesn’t matter whether you are single, married or an unmarried head of household. You may homestead your mobile home even though you don't own the land the mobile home sits on. Some mortgages may prohibit homesteading, check with your lender to ascertain their position on you homesteading your property.

Be aware that a homestead will not protect your home or mobile home if the judgment or lien is for: Taxes, the mortgage or deed on the home or mobile home, improvements made on the home or mobile home, mechanics liens and other liens on the home or mobile home, any debt or obligation you willfully and voluntarily incur.

Thanks to legislative changes this year, you can protect $550,000 of your equity. If your equity exceeds $550,000 you should go ahead and homestead understanding that you will only be able to protect $550,000 of your equity. To protect your property all you need to do is:

Click here to download Homestead form

You will need your parcel number and legal description to complete your Homestead form. If you do not have this information (it is on your recorded deed), you may get it from our online Real Property Records.

Click here to search your property records.

If you have any legal questions regarding this document, please consult your attorney.

PROCEDURE FOR RECORDING DECLARATION OF HOMESTEAD

1. Complete the Homestead Declaration form. The form must be printed legibly in black ink. Text cannot extend beyond the one inch margins on all sides of the form. An additional $25.00 recording fee could be applied if the form does not meet these requirements at time of recording.

2. Sign in the presence of a Notary Public.

3. Take the completed document to:  Clark County Recorder

If you have already filed a Declaration of Homestead on your property remember that you will need to prepare and record a new one if you: 1) Sell your home and buy another one, 2) move your mobile home from one lot space to another, 3) marry, 4) divorce or 5) become widowed, 6) get a new loan, 7) refinance.

The completed Homestead Declaration can also be mailed to the Recorder's main office. 

4. The recording fee is $14.00. Please make your check payable to the Clark County Recorder

WHAT THE LAW PROVIDES:

When you record a Declaration of Homestead, Nevada law protects the equity in your home up to $550,000 from general creditor claims (unpaid medical bills, bankruptcy, charge card debts, business/personal loans, accidents) but would not preclude a seizure or forced sale of your residence from general creditors if your equity exceeds the $550,000. A creditor may file suit and can record a judgment lien against any real property you own. Recording a Declaration of Homestead protects your principal residence up to the statutory maximum. For example, if the value of your home is $645,000 and you have a first mortgage of $485,000 plus a second mortgage of $10,000, the equity is $150,000.

WHAT IS NOT PROTECTED?

The Homestead Law does not protect you against debts secured by a mortgage or deed of trust, payment of taxes, IRS lien, mechanic's lien, child support or alimony payments.

Our Advice

Filing a Declaration of Homestead is easy and is such a valuable tool that we recommend all Nevada homeowners utilize this very inexpensive means to protect their home equity. 

Contact me today for more information:

Shirley Brass
2200 Paseo Verde Pkwy., Suite #160

Henderson, NV 89052
(702) 592-8207

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