Recently, the Governor of Puerto Rico, Jenniffer González Colón, signed into law Act No. 8-2026, which amends Articles 8 and 12 of Act No. 195-2011, as amended, also known as the Homestead Right and Family Home Protection Act. The purpose of this new legislation is to extend the statutory terms for: (i) reinvesting the proceeds from the sale of a Homestead Act property, and (ii) requesting the homestead protection benefit in cases involving judicial sales or foreclosure proceedings. Specifically, Act No. 8-2026 introduced the following changes:
- Reinvestment Period: Pursuant to amended Article 8, the owner of the homestead property now has a period of twelve (12) months to reinvest the proceeds received from the sale of such property in the purchase of another property located in Puerto Rico, which will constitute the new homestead. During this twelve (12) month period, the proceeds from the sale will remain protected against claims by creditors. However, this protection will not extend to any difference in value if the newly acquired property is of lesser value than the property sold. Therefore, this amendment extends the reinvestment period from nine (9) months to twelve (12) months.
- Term to Claim the Homestead Benefit: Pursuant to amended Article 12, the term to claim the homestead benefit in cases of forced sales by judgment, foreclosure, or any other mechanism intended to secure a judgment against the defendant’s property is extended from thirty (30) days to sixty (60) days, counted from the date of the execution of such judgment, foreclosure, or enforcement mechanism.
The Amendment of Act No. 8-2026 to the Homestead Act is effective upon enactment on January 4, 2026. Individuals who own their primary residence and who have (or expect to have) large equity on such property and have not yet requested the benefit of the Homestead Act are encouraged to procure the protection of that asset protection statute.
This document has been prepared for information purposes only and is not intended as and should not be relied upon as legal advice. If you have any questions or comments about the matters discussed in this notice, wish to obtain more information related thereto, or about its possible effect(s) on policy or operational matters, please contact us.