Of course, there are dozens of great reasons for moving to Texas.
Lots of jobs, no income tax, good schools, home-schooling, inexpensive real estate, a diverse economy, a powerful Oil & Gas industry, fair laws & courts, strong 2nd Amendment Rights, weak unions, and [relatively] good weather make Texas attractive. And, the list goes on.
But, did you know that Texas also has the strongest homestead laws in America?
Yes, it’s true.
What is a homestead? The basic definition:
Homestead – 1. A family’s house or farmhouse with adjacent buildings and land. 2. A tract of land granted, as under the Homestead Act, to a settler who cleared, cultivated, and lived on it. ~ Webster’s
Texas homestead laws are sacred, enshrined in the State Constitution. The laws are old, dating back to the birth of the Republic of Texas, and even before. They were created to protect Texas settlers during the volatile and dangerous frontier days. With them, wives and children were better able to keep their homes and ward of creditors if breadwinner husbands died early.
Nowadays, things have calmed down! But, homestead laws still offer most of the same protection.
So, what makes Texas homestead laws beneficial? Well, they protect your home AND property from many, but not all, creditors. The laws here are much more generous than in other states.
Here are the basics:
- Apply To Single Individuals & Married Couples Only
- Individual – 1 Homestead Limit
- Married Couple – 1 Homestead Limit
- No Dollar Limit On Property Value
- Urban Homestead, Individual & Married Couples – 10 Acres Max.
- Rural Homestead , Individual – 100 Acres Max.
- Rural Homestead, Married Couple – 200 Acres Max.
- No Mobile Home Or Boat Homesteads
- Undeveloped [Raw] Land Is Allowed, If A Home Will Be Built
Personal property protection:
- Single Individual – Up To $30,000 Of Personal Property
- Family – Up To $60,000 Of Personal Property
- IRA & 401(K) Retirement Accounts Are Protected
Of course, there are limits. You can potentially lose your homestead, in some situations. For example, the law does NOT protect you against the following:
- Federal Tax Liens
- Property Tax Liens
- Mechanics Liens
And some types of property are not shielded – including:
- Business assets
Finally, it’s important to note that homestead laws limit home refinance amounts. Loan-to-value ratios (LTVs) are capped at 80% in Texas. So, if your home was worth $100,000, you’d only be able to borrow up to $80,000 when refinancing. This rule actually protects homeowners. It’s one reason why Texas wasn’t hard hit by the housing bust back in 2008.
As you can see, homestead laws are just another solid reason to move to Texas. You can learn more detail here:
Do you already own a home in the Lone Star State? Don’t pay more than you should. File your yearly homestead exemption and get a break on your property taxes. Forms may be submitted annually between January 1st and April 30th.
[This blog post is intended for entertainment purposes only. I’m not a lawyer, this information is NOT legal advice. Always consult a qualified legal professional for specific details on the law or additional advice.]