If you are filed a claim against in court as well as lose, the individual that sued you could try to force the sale of your the home of accumulate their cash. A homestead makes it harder for them to do this.A homestead shields a few of the equity in your house. If your residence deserves even more loan compared to you owe on it, you have equity. For example, if your house is worth $350,000 as well as you owe $300,000, you have $50,000 in equity. A homestead could safeguard the $50,000.There are two sorts of homesteads, automatic and proclaimed. Arizona Realtors Just what is an automatic homestead?If you live in the home you own, you currently have one. It protects some of your home equity till you sell your residence. You do not need to authorize or file anything to have an automatic homesteadJust what is a proclaimed homestead?A declared homestead is a legal kind that you tape with the Registrar-Recorder's office. A declared homestead protects a few of your equity for six months after you sell your residence if the complying with 3 conditions are all real:You sell your residence and acquire an additional home within six months;The secured quantity is made use of to buy one more residence;You tape-record a homestead on the new residence.Only the house you reside in, gets a homestead.That requires a declared homestead?If you've been sued in court, lost, and have a big money judgment versus you, a stated homestead can assist. If you offer your home, it protects several of the proceeds for 6 months. This provides you time to acquire one more residence and also document an additional proclaimed homestead.How much does a homestead protect?Both automatic and proclaimed homesteads protect the same amounts:$ 50,000 for an individual;$ 75,000 if the property owner deals with a minimum of one relative who has no interest in your home;$ 150,000 if the property owner is 65 years old or older, or is literally or psychologically handicapped;$ 150,000 if the home owner is 55 years of age or older and also solitary with a yearly revenue of $15,000 or much less;$ 150,000 for a couple with a consolidated annual revenue of $20,000 or much less;A homestead does not secure you versus:Repossession of your residence by mortgage lender if you lag on repayments.The enforcement of a technician's lien;A judgment for kid or spousal assistance.Just how do I file a stated homestead?You can file a declared homestead by taking these actions:Get a declared homestead form from a stationery store or look for a common form online.Submit the type.Authorize the form as well as have it notarized.Get in touch with the Registrar-Recorder's workplace where the home is located for charges as well as filing addresses.Companies supplying to help you submit a stated homestead could not charge greater than $25.