In Texas, the homestead is
the place of residence for a family or a single person, secure from forced sale by general
creditors. Each spouse or single person has a possessory right in the homestead,
created by the Texas Constitution, which is lost only by death or abandonment and cannot
be compromised by waiver or voluntary act of the homestead owner. The term
exemption stems from the concept that the homestead is exempt from forced sale by a
homestead claimant’s general creditors. The homestead cannot ever be
mortgaged unless the mortgage is for one of the following three purposes:
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To obtain money to
finance the purchase of the homestead; |
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To obtain money to pay
taxes due on the homestead, or |
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To obtain money to
improve the homestead (home improvement loan). |
Simply stated, a homeowner is
protected from forced sale by his general creditors except for;
The contract to do the work was
in writing and
Signed by both husband and wife and
Filed for record in the county
of the homestead prior to the commencement of the work.
In order to prevent the
legislative branch of the government from casually changing the homestead exemption,
the exemption was incorporated into the State Constitution in 1845. Now only
constitutional amendments may change the substance of the exemption.
Exemptions May Reduce Your Tax
Bill
A homestead exemption reduces
taxes by lowering a home’s taxable value. To qualify, the home must be the principal
residence on January 1, owned by the person applying for the exemption and the applicant
cannot benefit from a homestead on any other property.
All school districts offer a
$5,000 homestead exemption reduction from the appraised value of a home, and some
offer an additional optional percentage homestead exemption reduction of up to 20%
of a home’s appraised value.
Ask
Gloria what your taxing authority offers for homestead exemptions.
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