New Hampshire Homestead Exemption Increases to $400,000 in 2025 Legislative Update

The New Hampshire Legislature passed substantial amendments to the state’s homestead law in 2025. These changes, effective January 1, 2026, increase the protection available to homeowners while also introducing new limits and conditions that could affect the scope of that protection in certain circumstances.

Increased Exemption Amounts

Under the amended law, the base homestead exemption rises from $120,000 to $400,000 for an individual. For multiple co-owners, the total combined exemption is capped at $550,000. Previously, there was no explicit total cap, and each co-owner could claim the statutory amount separately.

Unlimited Protection for Certain Medical Debt

The amendments create an unlimited homestead exemption when the debt arises from unpaid medical bills or other debts directly resulting from a terminal or catastrophic injury or illness.

Continuous Use and Rollover Requirements

To claim the exemption, the homeowner must have continuously used the property as a primary residence for the previous 12 months. Additionally, proceeds from the sale of a qualifying residence remain protected if reinvested in a new primary residence within six months.

Current law uses the word “residence” while the new law uses the term “primary residence.”  There is plenty of case law interpreting the word “residence,” so it remains to be seen how courts will approach the addition of the word “primary.”

New Exception for Pre-Existing Debts

The amended RSA 480:4 adds an exception for debts existing at the time the homestead was purchased (unless covered by the rollover provision).

Updated Notice Provisions

RSA 529:20-a, which governs the notice of homestead exemption given to property owners before a sheriff’s sale, has been updated to reflect the new $400,000 and $550,000 limits and to apply to “all persons with an interest therein” rather than only to married couples.

Key Takeaway

The 2025 amendments to New Hampshire’s homestead law greatly expand the potential protection for homeowners and a new obstacle for creditors, but they also introduce new requirements and limitations. While many will benefit from the increased exemption amounts, certain owners—particularly those with multiple co-owners, extended absences from their residence, or pre-existing debts—may find their protection narrowed. As with many legislative changes, the full impact will be shaped by how the courts interpret and apply these provisions in practice.

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