Preparing and Recording a Homestead Declaration
For many people, their home is their largest asset. Despite the importance of protecting your assets, homeowners overlook a statutory mechanism that can provide protection from creditors.
In Nevada, a homeowner can prepare and record a Homestead Declaration in the county in which the residence is located. Upon the recording of a properly prepared homestead exemption, any equity in the home that does not exceed $605,000 will be protected from general creditors. Any equity above $605,000 will not be protected and will be potentially subject to the reach of general creditors. For example, if a homeowner had equity in his or her home in the amount of $700,000, a general creditor with a judgment against the homeowner could potentially obtain $95,000 from the equity of the home upon the sale of the home to a third party or a forced judicial sale of the home pursuant to a judgment obtained against the homeowner.
While a properly prepared and recorded Homestead Declaration may provide protection against general creditors up to $605,000, the homestead exemption does not provide protection against certain types of liens, debts secured by mortgage or deed of trust, or obligations owed to the Department of Health and Human Services for Medicaid benefits. In the event you need assistance with a Homestead Declaration or would like to discuss the applicability of the homestead exemption to your needs, please feel free to contact an attorney at Lemons, Grundy & Eisenberg.