By Patterson                                    H.J.R. No. 31

      75R2106 DWS-D                           

                                 A JOINT RESOLUTION

 1-1     proposing a constitutional amendment permitting an encumbrance to

 1-2     be fixed on a homestead for certain extensions of credit.

 1-3           BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-4           SECTION 1.  Section 50, Article XVI, Texas Constitution, is

 1-5     amended to read as follows:

 1-6           Sec. 50.  (a)  The homestead of a family, or of a single

 1-7     adult person, shall be, and is hereby protected from forced sale,

 1-8     for the payment of all debts except for:

 1-9                 (1)  the purchase money thereof, or a part of such

1-10     purchase money;

1-11                 (2)  [,]  the taxes due thereon;

1-12                 (3)  [,]  an owelty of partition imposed against the

1-13     entirety of the property by a court order or by a written agreement

1-14     of the parties to the partition, including a debt of one spouse in

1-15     favor of the other spouse resulting from a division or an award of

1-16     a family homestead in a divorce proceeding;

1-17                 (4)  [,] the refinance of a lien against a homestead,

1-18     including a federal tax lien resulting from the tax debt of both

1-19     spouses, if the homestead is a family homestead, or from the tax

1-20     debt of the owner;

1-21                 (5)  [, or for] work and material used in constructing

1-22     improvements thereon, if [and in this last case only when] the work

1-23     and material are contracted for in writing, with the consent of

1-24     both spouses, in the case of a family homestead, given in the same

 2-1     manner as is required in making a sale and conveyance of the

 2-2     homestead; or

 2-3                 (6)  an extension of credit for any other purpose, if

 2-4     the extension of credit meets the requirements of Subsection (d) of

 2-5     this section.

 2-6           (b)  The [nor may the] owner or claimant of the property

 2-7     claimed as homestead, if married, may not sell or abandon the

 2-8     homestead without the consent of the other spouse, given in such

 2-9     manner as may be prescribed by law.

2-10           (c)  No mortgage, trust deed, or other lien on the homestead

2-11     shall ever be valid, except for a debt described by this section,

2-12     whether such mortgage, or trust deed, or other lien, shall have

2-13     been created by the owner alone, or together with his or her

2-14     spouse, in case the owner is married.  All pretended sales of the

2-15     homestead involving any condition of defeasance shall be void.  A

2-16     purchaser or lender for value without actual knowledge may

2-17     conclusively rely on an affidavit that designates other property as

2-18     the homestead of the affiant and that states that the property to

2-19     be conveyed or encumbered is not the homestead of the affiant.

2-20           (d)  An extension of credit under Subsection (a)(6) of this

2-21     section must be the only debt secured by the homestead.  Any prior

2-22     debt secured by the homestead must be paid in full before the

2-23     extension of credit under Subsection (a)(6) of this section or

2-24     refinanced as part of the extension of credit under Subsection

2-25     (a)(6) of this section.  A lender may not require that a person

2-26     obtain an extension of credit under Subsection (a)(6) of this

2-27     section as a condition of receiving an extension of credit not

 3-1     secured by the homestead.

 3-2           SECTION 2.  This proposed constitutional amendment shall be

 3-3     submitted to the voters at an election to be held November 4, 1997.

 3-4     The ballot shall be printed to permit voting for or against the

 3-5     proposition: "The constitutional amendment permitting a homestead

 3-6     to be used to secure a debt that is the sole debt secured by the

 3-7     homestead."