In my previous blog post about getting stopped by the Police in Dickinson, North Dakota, I explained that it was very important to me, to have a drivers license that shows the address of my “primary residence” or “homestead” in Idaho. Once you lose the ability to legally demonstrate that the home you own is your “primary residence” or “homestead”, you lose specific legal protections that can result in you losing your home.
I want to tell a true story of how this happened to someone that I knew. In the area that I grew up in, there was a man who was about forty years old, who was poor, and he did not make very much money. This man’s mother died, and she left to him in her Will, the family home that he had grown up in.
He lived in an old, beat up, single wide trailer. He drove an old, beat up Ford truck, with a homemade wooden bed, because the metal truck bed had rusted out. But once he inherited this modest, old, single family home, he figured that he could rent this home out for $500 to $600 per month, which would be a big financial help to him. The home was probably worth about $80,000.
He rented this home out to a Mexican family. With a big, fat, cow-legged, cankle-calved Mom, Dad, and several young children. Within about one month of moving in, Big Momma lost her footing on the front steps. Ay Chihuahua!!! K-Boom!
Big Momma was taken to the local hospital emergency room, where it was determined that she had broken bones, etcetera. If it would have been a person of normal weight and health, they would have been able to catch themselves or minimize their fall, and sustained a sprained ankle or sprained wrist. But Big Momma hit the ground like a ton of bricks. The hospital bill was like $40,000 or more, plus more costs for rehabilitation.
The Mexican family did not have health insurance, so they needed to sue somebody else to pay for Big Momma’s medical bills. The Mexican family hired and attorney, and they sued the home owner for “faulty steps”, “negligence”, and so forth.
Normally, a standard “homeowner’s insurance policy”, comes with coverage for accidents or injuries occurring to persons on your property. This is what the insurance policy for this house had.
However, was this a “primary residence”, “homestead”, or was this an “investment property” ?
Because the man who had inherited this house from his mother was not living there, and he had rented the house out, it was not his “primary residence”, it was an “investment property”, and the homeowner’s insurance policy on this house was void. The insurance company was not legally liable for Big Momma’s medical bills, and of course they wouldn’t pay.
There was a lawsuit judgement, against this man for his “faulty front steps” and “negligence” which led to Big Momma’s injuries, which took this house away from him, that was his family home that he had grown up in, that he had inherited from his mother.
In his whole life, this was all that he was ever going to have, and he lost it within less than a year, his family home, to a Mexican family that were probably in the United States illegally to begin with. He committed suicide.
This is what happens when you can’t prove that the home that you own is your “primary residence” or “homestead”.