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Home Buying in Texas: Homestead LawsDid you know that Texas is a Homestead State? What exactly is a homestead?DEFINITION: (House, Condominium, Townhouse, Permanently installed Mobile Home) URBAN: The Homestead of a family or a single, adult person, not otherwise entitled to a homestead shall consist of not more than ONE ACRE of land which may be in one or more lots, together with any improvements thereon. RURAL: FOR A FAMILY - not more that 200 acres which may be in one or more parcels, -with the improvements thereon. FOR A SINGLE ADULT PERSON - not otherwise entitled to a homestead, not more than 100 acres, which may be in one or more parcels, with the improvements thereon. IF A HOMESTEAD IS CONSIDERED TO BE RURAL - at the time of designation, the property is not served by municipal utilities and fire and police protection Why was the Homestead law passed?PURPOSE: The Texas Homestead Law was created for the primary purpose of securing for a family or a single adult person, not otherwise entitled to a homestead, a place for home, shelter and the earning of a livelihood from the claims of all creditors EXCEPT THE HOLDERS OF LIENS FOR PURCHASE MONEY, TAXES AND HOME IMPROVEMENT LOANS. How do you declare a Homestead?Upon the purchase of a new home, you must call the APPRAISAL DISTRICT of the County in which you reside and request that they mail you the necessary forms for 'Declaring Your Homestead':
ABANDONMENT OF A HOMESTEAD: If a homestead claimant is married, a homestead cannot be abandoned without the consent of the claimant's spouse. When the parties purchase a new homestead, it is generally clear that an abandonment has occurred. SALE AND LEASE OF HOMESTEAD PROPERTY: Any sale of homestead property that is less than the appraised fair market value wherein the buyer of the property executes a lease of the property to the seller at lease payments exceeding fair rental value of property is considered to be a loan with all payments made from the seller to the buyer in excess of the sales price considered to be interest subject to the usury stature as found in Article 5069.01 et seq.Such a transaction is also considered a deceptive trade practice. An exception to this rule applies to the sale of a family homestead to a parent, step-parent, grandparent, child, step-child, brother, half-brother, sister, half-sister, or Grandchild of an adult member of the family. Title Insurance is not available on any sale and leaseback of homestead property.Request for Information on Buying a Home
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