Texas Laws - Probate Code
CHAPTER XIII. GUARDIANSHIP
PART 5. SPECIAL PROCEEDINGS AND ORDERS

SUBPART F. SALE OF PROPERTY OF MINORS AND CERTAIN WARDS (6756)(1-click HTML)

Text of article effective until January 01, 2014 (6757)

Sec. 889. SALE OF PROPERTY OF A MINOR BY A PARENT WITHOUT GUARDIANSHIP. (a) When a minor has an interest in real or personal property and the net value of the interest does not exceed $100,000, a natural or adoptive parent, or the managing conservator, of a minor who is not a ward may apply to the court for an order to sell the minor's interest in the property without being appointed guardian. (6758)(1-click HTML)

A minor may not disaffirm a sale of property pursuant to a court order under this section. (6759)

(b) The parent shall apply to the court under oath for the sale of the property. Venue for the application under this section is the same as venue for an application for the appointment of a guardian for a minor. The application must contain: (6760)

(1) a legal description of the real property and a description that identifies the personal property; (6761)

(2) the name of the minor and the minor's interest in the property; (6762)

(3) the name of the purchaser; (6763)

(4) a statement that the sale of the minor's interest in the property is for cash; and (6764)

(5) a statement that all funds received by the parent shall be used for the use and benefit of the minor. (6765)

(c) On receipt of the application, the court shall set the application for hearing at a date not earlier than five days from the date of the filing of the application. If the court deems it necessary, the court may cause citation to be issued. (6766)

(d) At the time of the hearing of the application filed under this section, the court shall order the sale of the property if the court is satisfied from the evidence that the sale is in the best interests of the minor. The court may require an independent appraisal of the property to be sold to establish the minimum sale price. (6767)

(e) When the court enters the order of sale, the purchaser of the property shall pay the proceeds of the sale belonging to the minor into the court registry. (6768)

(f) Nothing in this section prevents the proceeds deposited in the registry from being withdrawn from the court registry under Section 887 of this code. (6769)

Added by Acts 1993, 73rd Leg., ch. 957, Sec. 1, eff. Sept. 1, 1993. Amended by Acts 1995, 74th Leg., ch. 1039, Sec. 68, 69, eff. Sept. 1, 1995; Acts 1997, 75th Leg., ch. 295, Sec. 2, eff. Sept. 1, 1997; Acts 2001, 77th Leg., ch. 127, Sec. 3, eff. Sept. 1, 2001; Acts 2001, 77th Leg., ch. 1174, Sec. 9, eff. Sept. 1, 2001. (6770)

Text of article effective until January 01, 2014 (6771)

(1) "Home equity loan" means a loan made under Section 50(a)(6), Article XVI, Texas Constitution. (6772)

(2) "Residence homestead" has the meaning assigned by Section 11.13, Tax Code. (6773)

(b) When a minor has an interest in a residence homestead and the net value of the interest does not exceed $100,000, a natural or adoptive parent, subject to Subsection (j) of this section, or the managing conservator, of a minor who is not a ward may apply to the court for an order authorizing the parent or managing conservator to receive, without being appointed guardian, an extension of credit on the minor's behalf that is secured, wholly or partly, by a lien on the homestead. Proceeds of the home equity loan attributable to the minor's interest may be used only to: (6774)

(1) make improvements to the homestead; (6775)

(2) pay for education or medical expenses of the minor; or (6776)

(3) pay the outstanding balance of the loan. (6777)

(c) The parent or managing conservator shall apply to the court under oath for the authority to encumber the residence homestead as provided by this section. Venue for the application is the same as venue for an application for the appointment of a guardian for a minor. The application must contain: (6778)

(1) the name and address of the minor; (6779)

(2) a legal description of the property constituting the homestead; (6780)

(3) a description of the minor's ownership interest in the property constituting the homestead; (6781)

(4) the name of the minor and the fair market value of the property constituting the homestead; (6782)

(5) the amount of the home equity loan; (6783)

(6) the purpose or purposes for which the home equity loan is being sought; (6784)

(7) a detailed description of the proposed expenditure of the loan proceeds to be received by the parent or managing conservator on the minor's behalf; and (6785)

(8) a statement that all loan proceeds received by the parent or managing conservator on the minor's behalf through a home equity loan authorized under this section shall be used in a manner that is for the minor's benefit. (6786)

(d) On receipt of the application, the court shall set the application for hearing at a date not earlier than the fifth day after the date the application is filed. If the court considers it necessary, the court may cause citation to be issued. (6787)

(e) Before the hearing, the parent or managing conservator shall file with the county clerk a surety bond in an amount at least equal to two times the amount of the proposed home equity loan. The bond must be: (6788)

(1) payable to and approved by the court; and (6789)

(2) conditioned on the parent or managing conservator: (6790)

(A) using the proceeds of the home equity loan attributable to the minor's interest solely for the purposes authorized by this section; and (6791)

(B) making payments on the minor's behalf toward the outstanding balance of the home equity loan. (6792)

(f) At the time of the hearing of the application filed under this section, the court, on approval of the bond required by Subsection (e) of this section, shall authorize the parent or managing conservator to receive the extension of credit sought in the application if the court is satisfied from a preponderance of the evidence that the encumbrance is for a purpose described by Subsection (b)(1) or (2) of this section and is in the minor's best interests. (6793)

(g) A parent or managing conservator executing a home equity loan on a minor's behalf under this section shall file an annual report with the court regarding the transaction. When the parent or managing conservator has expended the proceeds of a home equity loan authorized under this section, the parent or managing conservator, in addition, shall file with the county clerk a sworn report accounting for the proceeds. (6794)

(h) The court may not discharge the person's sureties from all further liability under the bond until the court: (6795)

(1) has approved the filing of the parent's or managing conservator's reports required under Subsection (g) of this section; (6796)

(2) finds that the parent or managing conservator used loan proceeds resulting from the minor's interest solely for the purposes authorized by this section; and (6797)

(3) has been presented with satisfactory evidence that the home equity loan has been repaid and is no longer considered an outstanding obligation. (6798)

(i) After the first anniversary of the date a parent or managing conservator executes a home equity loan authorized under this section, the court may, on motion of the borrower, reduce the amount of the surety bond required under this section to an amount that is not less than the outstanding balance of the loan. (6799)

(j) A parent of a minor may file an application under this section only if the parent has a homestead interest in the property that is the subject of the application. (6800)

(k) A minor may not disaffirm a home equity loan authorized by the court under this section. (6801)

Added by Acts 2005, 79th Leg., Ch. 1204, Sec. 2, eff. September 1, 2005. (6802)

Text of article effective until January 01, 2014 (6803)

Sec. 890. SALE OF PROPERTY OF WARD WITHOUT GUARDIANSHIP OF THE ESTATE. (a) This section applies only to a ward who has a guardian of the person but does not have a guardian of the estate. (6804)(1-click HTML)

(6805)

(b) When a ward has an interest in real or personal property in an estate and the net value of the interest does not exceed $100,000, the guardian may apply under oath to the court for an order to sell the ward's interest in the property without being appointed guardian of the estate. A ward may not disaffirm a sale of property pursuant to a court order under this section. (6806)

(c) Venue for an application under this section is the same as venue for an application for the appointment of a guardian for the ward. The application must contain the same information required by Section 889(b) of this code. (6807)

(d) On receipt of the application, the court shall set the application for hearing at a date not earlier than five days from the date of the filing of the application. If the court considers it necessary, the court may cause citation to be issued. (6808)

(e) The procedures and evidentiary requirements for a hearing of an application filed under this section are the same as the procedures and evidentiary requirements for a hearing of an application filed under Section 889 of this code. (6809)

(f) When the court enters the order of sale, the purchaser of the property shall pay the proceeds of the sale belonging to the ward into the court registry. (6810)

(g) Nothing in this section prevents the proceeds deposited in the court registry from being withdrawn as prescribed by Section 887 of this code. (6811)

Added by Acts 1997, 75th Leg., ch. 295, Sec. 4, eff. Sept. 1, 1997. Amended by Acts 2001, 77th Leg., ch. 127, Sec. 4, eff. Sept. 1, 2001; Acts 2001, 77th Leg., ch. 1174, Sec. 10, eff. Sept. 1, 2001. (6812)

Text of article effective until January 01, 2014 (6813)

(1) "Home equity loan" means a loan made under Section 50(a)(6), Article XVI, Texas Constitution. (6814)

(2) "Residence homestead" has the meaning assigned by Section 11.13, Tax Code. (6815)

(b) This section applies only to a minor ward who has a guardian of the person but does not have a guardian of the estate. (6816)

(c) When a minor ward has an interest in a residence homestead and the net value of the interest does not exceed $100,000, the guardian of the person of the ward may apply to the court for an order authorizing the guardian to receive an extension of credit on the ward's behalf that is secured, wholly or partly, by a lien on the homestead. Proceeds of the home equity loan attributable to the minor's interest may be used only to: (6817)

(1) make improvements to the homestead; (6818)

(2) pay for the education or maintenance expenses of the ward; or (6819)

(3) pay the outstanding balance of the loan. (6820)

(d) Venue for the application is the same as venue for an application for the appointment of a guardian for a ward. The application must contain the same information required by Section 889A of this code. (6821)

(e) On receipt of the application, the court shall set the application for hearing at a date not earlier than the fifth day after the date the application is filed. If the court considers it necessary, the court may cause citation to be issued. (6822)

(f) The guardian of the person, before the hearing, shall file a surety bond with the county clerk to the same extent and in the same manner as a parent or managing conservator of a minor is required to provide a surety bond under Section 889A of this code. (6823)

(g) The procedures and evidentiary requirements for a hearing of an application filed under this section are the same as the procedures and evidentiary requirements for a hearing of an application filed under Section 889A of this code. (6824)

(h) At the time of the hearing of the application filed under this section, the court, on approval of a bond required by Subsection (f) of this section, shall authorize the guardian to receive the extension of credit sought in the application if the court is satisfied from a preponderance of the evidence that the encumbrance is for a purpose described by Subsection (c)(1) or (2) of this section and is in the ward's best interests. (6825)

(i) A guardian of the person executing a home equity loan on a ward's behalf must account for the transaction, including the expenditure of the loan proceeds, in the annual accounting required by Section 741 of this code. (6826)

(j) The court may not discharge a guardian's sureties from all further liability under a bond required by this section or another provision of this code until the court: (6827)

(1) finds that the guardian used loan proceeds resulting from the ward's interest solely for the purposes authorized by this section; and (6828)

(2) has been presented with satisfactory evidence that the home equity loan has been repaid and is no longer considered an outstanding obligation. (6829)

(k) A minor ward may not disaffirm a home equity loan authorized by the court under this section. (6830)

Added by Acts 2005, 79th Leg., Ch. 1204, Sec. 2, eff. September 1, 2005. (6831)

  

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