Laws of Minnesota 1993 

                         CHAPTER 79-H.F.No. 592 
           An act relating to creditors' remedies; limiting the 
          value of the homestead exemption; providing for the 
          exemption of homestead insurance proceeds; increasing 
          the exemption for motor vehicles modified to 
          accommodate a disability; amending Minnesota Statutes 
          1992, sections 510.01; 510.02; 510.07; 510.08; 
          550.175, subdivisions 3 and 4; and 550.37, subdivision 
          12a. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
     Section 1.  Minnesota Statutes 1992, section 510.01, is 
amended to read: 
    510.01 [HOMESTEAD DEFINED; EXEMPT; EXCEPTION.] 
    The house owned and occupied by a debtor as the debtor's 
dwelling place, together with the land upon which it is situated 
to the amount of area and value hereinafter limited and defined, 
shall constitute the homestead of such debtor and the debtor's 
family, and be exempt from seizure or sale under legal process 
on account of any debt not lawfully charged thereon in writing, 
except such as are incurred for work or materials furnished in 
the construction, repair, or improvement of such homestead, or 
for services performed by laborers or servants and as is 
provided in section 550.175. 
    Sec. 2.  Minnesota Statutes 1992, section 510.02, is 
amended to read: 
    510.02 [AREA, AND VALUE; HOW LIMITED.] 
    The homestead may include any quantity of land not 
exceeding 160 acres, and not included in the laid out or platted 
portion of any city.  If it be the homestead is within the laid 
out or platted portion of such place a city, its area shall must 
not exceed one-half of an acre.  The value of the homestead 
exemption, whether the exemption is claimed jointly or 
individually, may not exceed $200,000 or, if the homestead is 
used primarily for agricultural purposes, $500,000, exclusive of 
the limitations set forth in section 510.05. 
    Sec. 3.  Minnesota Statutes 1992, section 510.07, is 
amended to read: 
    510.07 [SALE OR REMOVAL PERMITTED; INSURANCE PROCEEDS; 
NOTICE.] 
    The owner may sell and convey the homestead without 
subjecting it, or the proceeds of such sale for the period of 
one year after sale, to any judgment or debt from which it was 
exempt in the owner's hands, except that the proceeds of the 
sale are not exempt from a judgment or debt for a court ordered 
child support or maintenance obligation in arrears.  The 
proceeds of an insurance claim for an exempt homestead are 
exempt for one year.  The owner may remove therefrom without 
affecting such exemption, if the owner does not thereby abandon 
the same as the place of abode.  If the owner shall cease to 
occupy such homestead for more than six consecutive months the 
owner shall be deemed to have abandoned the same unless, within 
such period, the owner shall file with the county recorder of 
the county in which it is situated a notice, executed, 
witnessed, and acknowledged as in the case of a deed, describing 
the premises and claiming the same as the owner's homestead.  In 
no case shall the exemption continue more than five years after 
such filing, unless during some part of the term the premises 
shall have been occupied as the actual dwelling place of the 
debtor or the debtor's family. 
     Sec. 4.  Minnesota Statutes 1992, section 510.08, is 
amended to read: 
    510.08 [SELECTION AFTER LEVY.] 
    (a) If the premises so owned and occupied by the debtor or 
claimed under the debtor by another as exempt shall exceed the 
area herein prescribed, and the homestead shall not have been 
set apart as such and its boundaries defined, an attachment or 
execution may be levied upon the whole.  Thereupon the person 
entitled to the benefits of such exemption shall deliver to the 
officer making the levy a description of the part claimed as 
exempt, and the remainder only shall be subject to the levy so 
made.  
    (b) If the premises so owned and occupied by the debtor or 
claimed under the debtor by another as exempt exceeds the value 
prescribed in section 510.02, an attachment or execution may be 
levied upon the whole. 
    Sec. 5.  Minnesota Statutes 1992, section 550.175, 
subdivision 3, is amended to read: 
    Subd. 3.  [DESIGNATION OF HOMESTEAD PROPERTY.] The debtor 
must designate the legal description of the homestead property 
to be sold separately and the debtor's estimate of the value of 
the property.  The homestead property designated may include any 
amount of the property.  The designation must conform to local 
zoning, include the dwelling occupied by the debtor, and be 
compact so that it does not unreasonably affect the value of the 
remaining property.  The debtor must serve a copy of the 
designation on the executing creditor, the sheriff, and the 
county recorder by ten business days before the sale is 
scheduled. 
    Sec. 6.  Minnesota Statutes 1992, section 550.175, 
subdivision 4, is amended to read: 
    Subd. 4.  [SALE OF PROPERTY.] (a) If the sheriff receives a 
homestead property designation under subdivision 3, the sheriff 
must offer and sell the designated homestead property, and the 
remaining property, separately., unless the executing creditor 
denies the right to the exemption, objects to the property 
designated, or claims the value exceeds the exemption. 
    (b) If the executing creditor is dissatisfied with the 
homestead property designation or the debtor's valuation of the 
property, upon proper motion to the district court of the county 
in which any part of the property is located, the executing 
creditor is entitled to a court approved designation of the 
homestead and a court determination of value.  The court shall 
either approve the debtor's designation or cause the property to 
be surveyed and order a homestead designation consistent with 
the standards of subdivision 3 and require an appraisal of fair 
market value, as applicable.  The court's designation of the 
homestead property must conform to the debtor's request, to the 
extent not inconsistent with the standards of subdivision 3. 
    (c) The court, in determining appraised value, shall review 
any appraisals provided by the debtor and executing creditor and 
may require a court appointed independent appraisal.  The 
appraisals shall evaluate the property's fair market value, net 
of reasonable costs of sale. 
    (d) If the court determines that the property claimed as a 
homestead exceeds in value the amount of the homestead exemption 
or if the court determines that the property cannot be divided 
without material injury, the court shall order the sale of the 
entire property, including the designated homestead.  Out of the 
proceeds of the sale, the court shall pay the debtor the amount 
of the homestead exemption and apply the balance of the proceeds 
of the sale on the execution. 
    (e) At the sale, no bid may be accepted unless it exceeds 
the amount of the homestead exemption.  If no bid exceeds the 
exemption, the homestead is exempt. 
    (f) The cost of any court ordered survey or appraisal and 
of the sale must be collected on the execution, if the debtor 
designated as the debtor's homestead a greater quantity of 
property, property of greater value than the debtor was entitled 
to, or designated a parcel that does not meet the standards of 
subdivision 3.  In all other cases, the costs shall be borne by 
the executing creditor. 
     Sec. 7.  Minnesota Statutes 1992, section 550.37, 
subdivision 12a, is amended to read: 
    Subd. 12a.  One motor vehicle to the extent of a value not 
exceeding $2,000; or one motor vehicle to the extent of a value 
not exceeding $20,000 that has been modified, at a cost of not 
less than $1,500, to accommodate the physical disability making 
a disabled person eligible for a certificate authorized by 
section 169.345. 
    Presented to the governor April 30, 1993 
    Signed by the governor May 3, 1993, 4:29 p.m.