Texas Vet Loans
The Texas Veterans Housing Assistance program is sponsored and administered by the Texas
Veterans Land Board. It provides Texas Veteran's home loans at special interest rates.
- Purchase loans only... Not allowed for refinance loans...
for veterans and active military personnel who meet certain Texas residence requirements.
Vet loans are underwritten as either a VA loan or as a conventional loan.
- Approval from TVLB
is required in addition to the lenders normal approval.
- The standard VA Funding Fee applies
to loans using VA guidelines (loans with less than 5% down must go VA).
The chart below compares
the differences between a VA and Texas Vet loan.
||Texas Vet Loans
||Veterans in good standing with sufficient VA entitlement to insure loan
||Same as VA, plus, must be resident of Texas at time of application & meet Texas
Vet residence requirements
||Rates include lender paid rebate which can be used to reduce your closing costs.
||No lender paid rebate on Texas Vet rates.
|Maximum Loan Amount
||$1,000,000, including financed VA Funding Fee
||$417,000, including financed VA Funding Fee
||No additional requirements
||Must be Energy Star labeled & certified
- Many different rates with different amounts of lender rebate for reduced closing
- Rates change daily
- Base rate = 3.770%
- Disability Rate = 3.27%
- Rates usually change each week on Friday at about 5:30pm
|VA Funding Fee
||Required for VA underwritten loans.
To be eligible to participate in the Texas Veterans Loan Programs, an applicant must have:
- Served no fewer than 90 cumulative days on active duty or active duty training in the
Army, Navy, Air Force, Marines, Coast Guard or United States Public Health Service (unless
discharged sooner due to service-connected cause), OR completed all initial active duty
training required as a condition of service in the National Guard or reserve component of
one of the listed branches of service, OR have completed 20 years in a reserve component
so as to be eligible for retirement, OR served in the Armed Forces of the Republic of Vietnam
(ARVN) between February 28, 1961 and May 7, 1975 (ARVN - Housing Assistance Program or Home
Improvement Program only, no service era discount allowed).
- Served after September 16, 1940. (For housing or home improvement loans, certain interest
rate incentives may be available to Texas veterans who served on active
duty prior to January 1, 1977, and who have been discharged from active duty less
than 30 years.)
- Not been dishonorably discharged. A person who has been discharged from the branch of
the service in which the person served or from the National Guard is considered not to have
been dishonorably discharged if the person: (1) received an honorable discharge; (2) received
a discharge under honorable conditions; or (3) received a discharge and provides evidence
from the Veterans Administration, its successor, or other competent authority that indicates
that the character of the person's discharge has been determined to be other than dishonorable.
- Listed Texas as the home of record at the time of entry into the military OR must have
been a legal resident of Texas for at least twelve consecutive months immediately prior
to filing an application OR be on active military duty, stationed in Texas and have change
his/her state of legal residence to Texas. The applicant must also be a bona fide resident
of Texas at the time the application is made. (A "bona fide resident" is someone who is
living in Texas with the intent to remain in Texas). This may include a Texas Resident currently
serving on active military duty outside of Texas. Presence in Texas due solely to military
service may not establish bona fide residency.
- Successfully repaid any previous Texas Veterans Land Board (VLB) loan. A loan is considered
repaid when the account has been paid in full by the original veteran purchaser or last
approved assignee. Any other active VLB loans in programs other than the one for which application
is being made must be in good standing. Veterans are entitled to have only one loan in each
VLB program at the same time.
Note: The unmarried, surviving spouse of a Texas
veteran who is missing in action, or who died in the line of duty, or died from a service-connected
cause may be eligible to participate in the programs. The veteran's home of record must
have been Texas at the time of entry into the military, OR the veteran
must have been a legal resident of Texas at the time of death. Qualified unmarried, surviving
spouses may be eligible for interest rate discounts.
All VLB loans are subject to credit approval.
- Property Type - Single family, 1 unit homes, townhomes, approved
Condos and PUDs. Also, 2-4 unit multi-family properties that were constructed at least five
years prior to the closing date of your loan.
- Loan Terms - 15, 20, 25 or 30 year fixed rate loans.
- New construction homes - Must be
ENERGY STAR® labeled & certified
or HERS index score of 75 or less.
Note: If your sales contract is signed and
dated prior to the home receiving its Certificate of Occupancy, the home must meet the
Energy Star requirements. If your sales contract is signed and dated after the home
receives its Certificate of Occupancy, the home may not have to meet the Energy Star
- Zero Down Loans - Must use VA underwriting.
VA Funding Fee is required unless veteran is exempt.
- Conventional Underwritten Loans - Minimum of 5% down payment
Mortgage insurance required on loans over 80% LTV.
80/10/10 loans are allowed. No 80/15/5 loans.
80/10/10 Texas Vet Loan using Conventional Underwriting
Maximum Sales price = $521,250
Texas Vet loan = $417,000
10% 2nd lien loan = $52,125
10% Downpayment = $52,125
- No mortgage insurance required
- Lower monthly payment
- Option to waive escrows
- Greater tax deduction since 2nd lien interest is tax deductible
- Can pay off 2nd lien early to reduce your payment
- Occupancy - The veteran is required to occupy the home within
60 days after closing. The home must remain the veteran's primary residence
for a period of at least three years. (You can't convert the home to a rental or 2nd home,
but you can sell it)
- Closing costs can be higher on Texas Vet loans vs. VA loans
since no premium pricing is available on Texas Vet rates. Up to a 1% origination fee and
up to a 1% participation fee can be charged on Texas Vet loans, depending on your loan amount.
- Credit Scores -
The minimum middle credit score is 640.
- Escrow Waiver
VA guaranteed loans - Taxes and insurance must be escrowed with the lender.
Conventional Underwriting - You can choose to pay your own taxes
and insurance if your loan to value is 80% or less. This includes 80/10/10 loans. An escrow
waiver fee will be added to your closing costs.
- Manufactured Homes - Single-wide and Double-wide manufactured
homes are not eligible.
- Minimum Loan Amount
The current Texas Vet base rate is 3.770%. The Texas Vet
program also provides a 0.50% rate discount to qualified borrowers with verified VA Disabilities
rated at 30% or higher. The current rate with this discount is 3.27%
- Veterans with Disabilities Discount - Texas Veterans with a compensable
service-related disability of 30% or greater, as verified by a VA award letter dated within
the 12 month-period immediately preceding the date of closing.
: All discounts summarized in these notes
are subject to detailed qualification guidelines found in the complete program description.
A complete description for Veterans with Disabilities qualification guidelines is available
Veterans with Disabilities
|Base Rate & Discount Programs
30 day lock.
|Base Rate - 15, 20, 25 & 30 year loans
|Disabled Veterans Discount
(Qualified Veterans with 30% VA Disability rating)
- This is a short form that only takes a few minutes to complete.
- It will give us the info we need to pre-qualify you according to your income,
debts and funds available for down payment and closing costs.
- The results will be emailed to you with an estimate for your review.
- The Pre-Qualify form is primarily designed for borrowers with good credit since
NO credit report will be pulled with this prequalification.
Email or call us if
you need additional information.
An unmarried surviving spouse is eligible if the veteran died as a result of a service connected
disability or while on active duty or is missing in action. The veteran's home of record must
have been Texas at time of entry into military or the veteran was a resident of Texas at the
time of death. You may also be eligible for interest rate discounts.
Children are not eligible.
VA Underwriting - Since Texas is a common law state, the answer
> If you are engaged and not living together as man and wife, the answer is NO. You must be
married. The veteran can purchase in their name only using only their income and debts to qualify.
> If you are living together as man and wife and claim to be married under common law it is
possible to get a VA loan. These are dealt with on a case by case basis. Please contact us for
Conventional Underwriting - YES. You can purchase the home together
using both your incomes and debts to qualify. Remember, conventional underwriting requires a
minimum of 5% down.
Yes, but the amount VA will guarantee remains the same. (25% of loan amount, up to the max.
Texas Vet loan amount of $417,000)
** Most lenders are not able to do this type of loan because of system limitations. We do not
offer this type of loan.
Yes, but the amount VA will guarantee remains the same - 25% of the loan amount, up to the
maximum Texas Vet loan amount of $417,000.
** Most lenders are not able to do this type of loan because of system limitations.
We do not offer this type of loan.
Veteran must certify that they will personally take occupancy within 60 days of closing on
1) When you have sold your previous home and the Texas Vet/VA loan is paid in full, or
2) When you have sold your previous home to a veteran who substitutes his/her entitlement for
3) When you have paid off a Texas Vet/VA loan, but still own the property. VA will reinstate
your entitlement for this purpose one-time only. After that you must sell your properties that
have or had VA financing on them to use your entitlement again.
1) Your ex-spouse must refinance the home and/or pay off the Texas Vet/VA loan, or
2) Your ex-spouse is a veteran who agrees to substitute her entitlement for yours.
Private lenders make the loans.
You can only have one Texas Vet loan at a time.
You may, however, be eligible for a VA loan, but this depends on how much entitlement you
have left for VA to insure the new home.
Maximum entitlement is $104,250. If your current VA loan used $20,000 of entitlement, you have
$84,250 remaining. The maximum loan amount for the new home would be $337,000. ($84,250 divided
Texas Vet Links
Texas Vet does not allow purchasing a second home or an investment property with a Texas
However, you may be able to refinance your Texas Vet/VA loan on a second home or investment property using
a VA IRRRL.
Not allowed. Texas Vet loans are only for purchasing your home.
If your Texas Vet loan used your VA Eligibility to guarantee the loan, you may be able to
refinance it with a
even if it is now a second home or investment property.