Utah Homestead Laws

Many people dream of owning a home, and when they do, their nightmare is losing it. Especially if they have significant debt and the creditors come calling, their first concern is probably their home.

Fortunately for homeowners in the Beehive State, homestead protection laws are in place, intended to protect people from losing their homes in the event of a bankruptcy. Under homestead statutes, a person in debt is allowed to set aside a specific amount of real property, referred to as a "homestead," that would be off limits to some creditors. This is an introduction to homestead laws in Utah.

Homestead Statutes in Utah

Each state’s homestead laws can vary, especially in the limits they place on the value or acreage of property to be designated as a homestead. Utah law doesn’t reference acreage, and instead limits the homestead exemption to $20,000 if the property is the person’s primary residence. The table below lists Utah’s homestead statutes.

Homestead Exceptions

Unfortunately, Utah’s homestead exemption laws might not protect you from every creditor. There are four general exceptions under which you may still be forced to sell or forfeit property or real estate:

• If there was a pre-existing lien on the property before the establishment of homestead;
• If the homestead property was specifically pledged as credit for a mortgage;
• If you owe past due taxes to the State of Utah and Utah counties or municipalities; or
• If you owe money to mechanics, contractors, or builders for work performed in repairing or improving the property.

Additionally, these homestead protections exist as state laws, and federal income tax liens may be superior to Utah’s homestead exemptions. Under the Constitution’s Supremacy Clause, state laws are subject to federal override if there is an overlap or a conflict of law. However, the Internal Revenue Service (IRS) has generally been averse to foreclose on a citizen’s home to collect on a tax debt. Instead, the IRS usually gets involved only if a homestead property is mortgaged or sold off before the federal tax lien has expired.

Utah Homestead Laws: Related Resources

State homestead exemptions, and the exceptions to them, can be difficult to understand. And bankruptcy laws can be equally confusing. If you would like legal assistance regarding homestead issue, you can consult with a Utah real estate attorney or a Utah bankruptcy attorney. You can also find additional articles and information in FindLaw’s section on Homestead Protections.