Texas Homestead Law

Homestead protection laws in Texas are designed to help people in the event of a foreclosure, death of a loved one, or any change in economic circumstances that an individual may face. What is a homestead and who is entitled to a homestead protection? Let’s see. What is a Homestead? In order to discuss homestead protections, one must first understand what a homestead is. In the legal field, a homestead is defined as the house, outbuildings, and adjoining land owned and occupied by a person or family as a residence. Chapter 41 of the Texas Property Code differentiates homesteads as being urban or being rural. The Code states determines if the homestead is urban or rural based on the following: (a) If used for the purposes of an urban home or as both an urban home and a place to exercise a calling or business, the homestead of a family or a single, adult person, not otherwise entitled to a homestead, shall consist of not more than 10 acres of land which may be in one or more contiguous lots, together with any improvements thereon. (b)  If used for the purposes of a rural home, the homestead shall consist of: for a family, not more than 200 acres, which may be in one or more parcels, with the improvements thereon; or 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. (c)  A homestead is considered to be urban if, at the time the designation is made, the property is: located within the limits of a municipality or its extraterritorial jurisdiction or a platted subdivision; and served by police protection, paid or volunteer fire protection, and at least three of the following services provided by a municipality or under contract to a municipality: (A)  electric; (B)  natural gas; (C)  sewer; (D)  storm sewer; and (E)  water. (d)  The definition of a homestead as provided in this section applies to all homesteads in this state whenever created. Note, Texas no longer provides a homestead exemption to businesses exclusively; instead, the statute allows the urban classification to apply to both home and businesses. Texas courts have repeatedly determined that the homestead lies on the intent of how the individual plans to use the property even though the individual does not necessarily have to reside on the property. Texas Homestead Protections Now that it is established what a homestead is, it is proper to discuss what protections it extends. Establishing a homestead extends the following protections: Creditor Protection before and after death; Special occupancy rights for surviving spouses and minor children; and Tax Savings. Creditor Protection Before and After Death According to the Texas Constitution and Section 270 of the Texas Probate Code, the homestead of a family, or of a single adult person, shall be, and is hereby protected from forced sale, for the payment of all debts except for the exceptions listed by...
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