The homestead exemption is important for your primary residence because it provides tax reductions and protection from creditors. Homestead will cause up to $50,000 worth of a property’s assessed value to be exempt from taxes and it limits the annual increase of the assessed value to at most 3% per year under the Save Our Homes assessment limitation. For most creditors, it will be impossible for them to attach liens against your property and they cannot force you to sell your homestead to pay your debt.
If you are married, then the homestead protections extend to your spouse, even if your spouse is not on the title of your homestead. If you divorce, homestead status will continue if you or your spouse remain living in the property as a primary residence. However, you should notify the property appraiser if you or your spouse no longer live in the property. If you or your spouse leave the property and purchase a new primary residence, then you or your spouse will need to apply for homestead for the new primary residence.
Note that you can transfer your part of the Save Our Homes assessment limitation from your old homestead to your new homestead. Once you purchase a new primary residence, contact your property appraiser and ask them about transferring the Save Our Homes assessment limitation from your old homestead to your new homestead.