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Members consider raising New Hampshire homestead exemption after homeowners recount litigation and leverage concerns
Summary
Representative Melissa Litchfield and supporters urged raising the state homestead exemption to better match current home values and to protect homeowners from judgments; attorneys and lawmakers discussed bankruptcy interactions, trusts, domestic-support exceptions and whether $500,000–$1,000,000 is appropriate.
The committee heard testimony on House Bill 617 on Feb. 4, a proposal to raise New Hampshire’s statutory homestead exemption to better reflect modern property values and protect families’ home equity from creditor judgments. Representative Melissa Litchfield, the bill’s sponsor, said the current $120,000 exemption has not kept pace with property values and urged an increase, with discussion focusing on figures between $500,000 and $1,000,000.
Representative Litchfield described the rationale in both policy and practice: the homestead exemption preserves housing stability when plaintiffs seek judgments unrelated to mortgages or other secured debts. She cited examples from her legal practice where claimants threatened to attach homeowners’ equity and prompted larger settlements. "The equity of this one asset deserves greater protection in New Hampshire," she said.
Supporters in the hearing and cosponsors advocated larger exemptions and asked the committee to include trusts in coverage. Representative Henry Gerson said he preferred a $1,000,000 threshold given current median home values and called for explicit trust coverage. Attorney Charles Russell, who has practiced since the 1970s, suggested clarifying language around manufactured housing, expanding the reinvestment period for sale proceeds from six to 12 months, and specifying that the homestead exemption applies to property taxes (real-estate taxes) where intended.
Witnesses also discussed the Brady v. Sumske New Hampshire Supreme Court decision and whether statutory clarifications are needed to ensure spouses and partners can claim the exemption. Representative Litchfield said she planned to file a technical amendment on trusts and suggested the committee consider the precise dollar figure during mark-up.
Chief assessor and other municipal officials did not object to raising the exemption amount in principle but asked the committee to consider implementation details. The committee took testimony and did not vote on the bill at the hearing.
