Texas VA Home Loans
Eligible Texas veterans and service members with full entitlement can purchase a home with no down payment, no loan limit, and no monthly mortgage insurance. The VA funding fee is 2.15% for a first-time purchase with zero down; veterans receiving VA disability compensation pay no funding fee at all.
Texas has one of the largest veteran populations of any state in the country and the most extensive military installation footprint in the US; the VA loan is the most widely used mortgage product in communities surrounding Fort Cavazos, Joint Base San Antonio, Fort Bliss, and dozens of other Texas installations.
VA vs. FHA Loans vs. Conventional: Quick Comparison
For eligible Texas veterans and service members, VA consistently produces the lowest monthly cost of any standard mortgage program.
| Feature | VA | FHA | Conventional |
|---|---|---|---|
| Down payment | 0% | 3.5% (580+ score) | 3–5% |
| Monthly mortgage insurance | None | MIP, life of loan (<10% down) | PMI, cancels at 20% |
| Funding fee | 2.15% first use (0% down) | 1.75% upfront MIP | None |
| Credit score (program min.) | None set | 580 | 620 |
| 2026 loan limit | None (full entitlement) | $541,287 most counties | $832,750 |
| Seller concessions | Up to 4% + normal closing costs | Up to 6% | 3–6% by LTV |
Why the VA Loan Matters in Texas
Texas is home to more active-duty military, veterans, and military retirees than any other state except California. The sheer size of the Texas military community means the VA loan is a dominant force in the state’s mortgage market, particularly in the communities built around its major installations.
Fort Cavazos (formerly Fort Hood) in Killeen and Harker Heights is the largest military installation in the United States by land area and one of the largest Army posts in the world, home to III Corps and the 1st Cavalry Division. The Killeen-Temple-Fort Hood metro area has one of the highest VA loan utilization rates in the country as a direct result.
Joint Base San Antonio, encompassing Lackland Air Force Base, Randolph Air Force Base, and Fort Sam Houston, is the largest joint base in the Department of Defense and one of the most important military hubs in the country. The San Antonio metro area has a massive veteran and active-duty population served extensively by VA home financing.
Fort Bliss in El Paso is one of the world’s largest Army installations and is home to the 1st Armored Division. Its military community deeply shapes El Paso and has consistently strong VA loan volume.
Naval Air Station Corpus Christi serves as a primary naval aviator training site. The Corpus Christi area also hosts significant retiree and veteran populations.
Dyess Air Force Base in Abilene, Sheppard Air Force Base in Wichita Falls, Goodfellow Air Force Base in San Angelo, and Naval Air Station Joint Reserve Base Fort Worth round out a military presence that touches nearly every major Texas metro.
These installations generate concentrated VA loan demand in their surrounding communities, and the broader Texas veteran population creates significant VA activity across the entire state.
Texas State Veteran Benefits
Texas offers some of the most generous state-level veteran home benefits in the country, separate from and in addition to the federal VA home loan.
Texas Veteran Land Board (VLB) Home Loan Program
The Texas Veteran Land Board administers its own home mortgage program exclusively for TX veterans. The VLB program offers below-market interest rates on home loans up to specific amounts for veterans who have served at least 90 days of active federal duty and were honorably discharged. The Texas VLB program can be used independently or, in some cases, alongside other state programs.
Full program details, current rates, and eligibility requirements are available at glo.texas.gov/vlb. Veterans eligible for both the federal VA loan program and the VLB program should compare both options with a Texas-licensed lender or loan officer before choosing.
Homes for Texas Heroes (TDHCA)
The Texas Department of Housing and Community Affairs (TDHCA) administers the Homes for Texas Heroes program, which provides down payment assistance and a below-market mortgage rate for veterans, active-duty military members, and surviving spouses, among other qualified professions.
The program pairs with FHA, VA, USDA, and conventional first mortgages and provides a grant or second mortgage for down payment and closing costs. Income limits apply. Full program details are available at tdhca.state.tx.us.
Texas Property Tax Exemption for Disabled Veterans
Texas provides one of the most significant property tax benefits available to disabled veterans anywhere in the country. The exemption applies to a disabled veteran’s primary homestead and scales with the disability rating:
| Disability Rating | Exemption |
|---|---|
| 10–29% | $5,000 off appraised value |
| 30–49% | $7,500 off appraised value |
| 50–69% | $10,000 off appraised value |
| 70–99% | $12,000 off appraised value |
| 100% disabled OR 70%+ AND blind or missing a limb | Complete homestead exemption from property taxes |
The 100% disabled veteran exemption eliminates property taxes entirely on the primary residence. For a veteran in a community with a 2.5% effective property tax rate on a $350,000 home, that exemption is worth approximately $8,750 per year. This state benefit is administered through the county appraisal district and requires an application with VA rating documentation.
Surviving spouses of veterans who qualify for the exemption may continue to receive it under specific conditions. Contact your county appraisal district for current application procedures.
No Texas State Income Tax
Texas imposes no personal state income tax, which meaningfully improves take-home pay and overall affordability calculations relative to veterans relocating from states with income taxes. This is not a VA-specific benefit but directly affects the financial case for purchasing in Texas.
VA Eligibility: Who Qualifies in Texas
VA mortgage eligibility in Texas covers four main groups: veterans, active-duty service members, National Guard and Reserve members, and qualifying surviving spouses.
Veterans: 90 or more days of active duty during wartime with honorable discharge; 181 or more consecutive days of peacetime active duty with honorable discharge; or 24 months of continuous service for those who enlisted after September 7, 1980.
Active-Duty Service Members: Currently serving members who have completed 90 or more consecutive days of active service.
National Guard and Reserve Members: Texas National Guard members and Reservists who have completed 6 years of qualifying honorable service, or who have been activated on federal orders for 90 or more days under Title 10 authority.
Surviving Spouses: Unremarried surviving spouses of veterans who died in service or from service-connected disabilities. Surviving spouses of veterans who are totally disabled from a service-connected condition and died from any cause may also qualify with specific requirements.
See complete VA eligibility documentation →
Certificate of Eligibility (COE)
The Certificate of Eligibility confirms that a borrower meets VA service requirements and shows the entitlement amount available. Most VA-approved lenders can retrieve the COE electronically within minutes through the VA’s Automated Certificate of Eligibility system during pre-approval. Veterans can also request the COE directly using VA Form 26-1880 with their DD-214 through the VA’s eBenefits portal.
2026 VA Funding Fee
The VA funding fee is a one-time charge that replaces monthly mortgage insurance. It can be financed into the loan.
Purchase Loan Funding Fees:
| Down Payment | First Use | Subsequent Use |
|---|---|---|
| Less than 5% | 2.15% | 3.30% |
| 5% to 9.99% | 1.50% | 1.50% |
| 10% or more | 1.25% | 1.25% |
Refinance Funding Fees:
| Loan Type | Fee |
|---|---|
| VA IRRRL (Streamline) | 0.50% |
| VA Cash-Out (First Use) | 2.15% |
| VA Cash-Out (Subsequent Use) | 3.30% |
Funding Fee Exemption
Veterans receiving VA disability compensation pay no funding fee. Purple Heart recipients on active duty are also exempt. For a disabled TX veteran purchasing a $400,000 home, the exemption saves $8,600 on a first-use home purchase with no down payment.
If a disability claim is pending at closing, the funding fee must be paid but may be fully refunded retroactively once the VA approves the claim.
See our complete VA funding fee guide →
No Loan Amount Limit for Texas Veterans With Full Entitlement
Since January 1, 2020 (the Blue Water Navy Vietnam Veterans Act), VA imposes no maximum loan amount for veterans with full entitlement. A TX veteran can purchase a $500,000 home in Austin, a $750,000 home in Dallas, or a $1.2 million home in Houston with zero down payment if their income supports the qualification.
This is particularly relevant in Texas’s high-growth metros, Austin, Dallas-Fort Worth, and Houston, where home prices have increased substantially. An eligible veteran in these markets can use VA financing without a price ceiling, while a non-veteran buyer above the conventional conforming limit of $832,750 would need jumbo financing.
Veterans with partial entitlement (due to an active VA loan or prior VA loan loss) may be subject to county limits. A VA-approved lender can calculate available entitlement from the COE.
Credit Requirements
The VA sets no minimum credit score. Individual Texas lenders typically require 580–640 through their overlays. Some VA-experienced lenders work with scores below 580 through manual underwriting. The most recent 12 months of payment history carries the most weight in VA credit evaluation.
DTI and Residual Income
VA uses two qualification standards: a back-end DTI guideline of 41% and the residual income test, which measures actual monthly cash remaining after all obligations are paid.
Texas falls in the South region for VA residual income calculations. For a family of four with a loan above $80,000, the minimum residual income is $1,003/month. Files above the 41% DTI guideline can still be approved when residual income is strong.
Eligible Property Types in Texas
VA financing covers primary residences only. Eligible property types include single-family homes, VA-approved condominiums, townhomes, 2-4 unit properties when the borrower occupies one unit, and manufactured homes on permanent foundations with restrictions.
Multi-unit properties: VA allows you to buy a home of 2-4 unit properties with zero down when the borrower lives in one unit. Rental income from the other units can help qualify.
Condominiums: The development must be on the VA’s approved list. Verify any Texas condo development at lgy.va.gov/lgyhub/condo-report before making an offer.
Not eligible: Investment properties, vacation homes, and properties the borrower does not intend to occupy as their primary residence.
VA Minimum Property Requirements
Every VA purchase includes an appraisal evaluating both market value and property condition against VA Minimum Property Requirements. The VA appraisal is not a home inspection; always commission a private inspection in addition.
Seller Concessions
VA allows sellers to contribute up to 4% of the established home value toward the buyer’s costs in concessions, in addition to normal closing costs. On a competitive Texas purchase, a motivated seller can cover the VA funding fee and most closing costs within this allowance.
Documenting Income for a Texas VA Loan
Texas VA borrowers document income using standard VA guidelines. W-2 employees provide pay stubs for the most recent 30 days, W-2s for the past 2 years, and federal tax returns for the past 2 years. Self-employed borrowers (25%+ business ownership) add business returns and a year-to-date profit and loss statement. Veterans receiving disability compensation, military retirement, or investment income document two years of consistent receipt through bank statements and award letters.
VA Refinance Options for TX Veterans
Texas VA borrowers have two refinance paths: the IRRRL for existing VA loan holders wanting a lower rate with minimal documentation, and the cash-out refinance for accessing equity or converting a non-VA loan to VA financing.
VA IRRRL (Streamline Refinance): For existing VA loan holders. A credit report with scores is required, but income documentation and an appraisal are typically waived. Must result in a lower interest rate. Funding fee: 0.50%.
VA Cash-Out Refinance: Allows refinancing any existing mortgage into a new VA loan and accessing equity in cash. Full income documentation and appraisal required. Available to TX veterans who originally purchased with a conventional loan or FHA financing.
See VA Cash-Out Refinance details →
VA Second-Tier Entitlement in Texas
Second-tier entitlement allows a veteran to hold two active VA loans simultaneously, most commonly when military orders require a new purchase before selling the current VA-financed home. TX veterans receiving PCS orders to a new installation, or relocating within the state, may qualify.
See VA Second-Tier Entitlement Calculator →
Loan Rate Types Available in Texas
Texas VA borrowers can choose from three rate structures depending on how long they plan to stay in the home.
30-year fixed: The most common choice. Stable monthly payment for the life of the loan.
15-year fixed: Higher monthly payment but lower interest rate and significantly faster equity accumulation.
Adjustable-rate mortgage (ARM): Available in 5/1, 7/1, and 10/1 structures, fixed for the initial period then adjusting annually. Suitable for veterans confident they will sell or refinance before the fixed period ends.
Frequently Asked Questions About Texas VA Loans
Texas veterans have access to one of the strongest combinations of federal and state benefits available anywhere in the country. The VA loan eliminates the down payment and monthly mortgage insurance that add cost to conventional and FHA financing, while Texas-specific programs like the VLB home loan and Homes for Texas Heroes can layer additional savings on top. No state income tax, a robust real estate market, and a significant military presence across the state make Texas a natural fit for veterans putting down roots.
Whether you are buying near a base, relocating from out of state, or purchasing in a city far from any installation, the process works the same way. A VA-approved lender retrieves your Certificate of Eligibility electronically, confirms your entitlement, and walks you through the remaining steps. Most veterans are closer to closing than they expect.
Who qualifies for a VA loan in Texas?
Veterans with qualifying military service and an honorable or general discharge, active-duty members with 90 days of continuous service, Texas National Guard and Reserve members with 6 years of qualifying service or Title 10 activation for 90+ days, and unremarried surviving spouses of veterans who died in service or from service-connected disabilities.
Is there a VA loan limit in Texas for 2026?
No loan amount limit applies to veterans with full entitlement. TX veterans can finance any purchase price their income supports with no down payment. This matters most in Austin, Dallas, and Houston, where prices regularly exceed the conventional conforming limit of $832,750.
Does Texas offer any additional loan benefits for VA mortgage holders?
Yes. The TX Veteran Land Board (VLB) offers a separate state-level home loan program at competitive rates. The Homes for Texas Heroes program provides down payment assistance for veterans through TDHCA. Disabled veterans may qualify for a partial or complete property tax exemption on their homestead; veterans with a 100% disability rating or qualifying combined conditions pay zero property taxes on their primary residence.
What is the VA funding fee for Texas veterans in 2026?
First-time use with no down payment: 2.15%. Subsequent use with no down payment: 3.30%. Putting 5% down reduces both to 1.50% and eliminates the subsequent-use penalty. Veterans receiving VA disability compensation pay no funding fee. See the full breakdown in the funding fee section above.
Can I use a VA loan in Austin or Dallas where home prices are high?
Yes. Veterans with full entitlement have no loan limit, the Blue Water Navy Act eliminated county-level caps effective January 1, 2020. A veteran purchasing in Austin, Dallas, or Houston can finance any amount their income supports with zero down, regardless of purchase price.
Can I buy a multi-unit property in Texas with a VA loan?
Yes. VA allows purchase of 2-4 unit properties with zero down when you occupy one unit. Rental income from the other units can help you qualify. This is available throughout Texas, including the major metros.
Can I get a VA loan after bankruptcy in Texas?
Yes. Chapter 7 requires a 2-year waiting period from the discharge date with re-established credit. Chapter 13 allows applying after 12 months of on-time trustee payments with court approval.
See VA loan after bankruptcy guide →
Do VA loans require a down payment in Texas?
No. Texas veterans with full entitlement can purchase at any price with zero down. Putting 5% down voluntarily reduces the funding fee from 2.15% to 1.50% and eliminates the subsequent-use penalty on future VA loans.
What fees and closing costs apply to a Texas Vet loan?
VA prohibits lenders from charging veterans certain fees — non-allowable costs must be paid by the seller, lender, or agent. Allowable costs include the VA appraisal, credit report, title insurance, recording fees, prepaid taxes and insurance, and an origination fee capped at 1% of the loan amount. The funding fee (2.15% first-use, no down) is the highest single cost and can be financed into the loan. Sellers can contribute up to 4% of the established value toward the buyer’s costs.
How long does a Texas VA loan take to close?
Typically 30-45 days from completed application. VA appraisals and any required repair conditions are the most common source of variance. Responding promptly to every lender document request keeps the timeline on track.
What is the difference between a Texas VLB loan and a VA loan?
The VA loan is a federal mortgage benefit backed by the U.S. Department of Veterans Affairs, available to eligible veterans and service members nationwide. The Texas VLB loan is a separate state program administered by the Texas Veterans Land Board that offers below-market interest rates exclusively to Texas residents who qualify as veterans, active-duty members, or surviving spouses.
The core differences come down to source, structure, and use. A VA loan requires no down payment for borrowers with full entitlement and carries no monthly mortgage insurance, but it can only be used to purchase or refinance a primary residence. The VLB Home Loan Program requires a minimum down payment (typically 3%) and has its own loan limits set by the state, but it also offers land loans and home improvement loans that VA financing does not cover. VLB interest rates are set by the state and may be competitive in certain rate environments, though they fluctuate independently of market rates.
Qualifying for one does not automatically qualify you for the other. VA eligibility is based on federal service requirements. VLB eligibility requires Texas residency and meeting the board’s service criteria, which are similar but administered separately.
Can you use a Texas VLB loan and a VA loan together?
In some cases, yes. The most common combination is using a VA loan as the primary mortgage and a VLB loan for a land purchase or home improvement project, since those are separate transactions for different purposes. A veteran could finance raw land through the VLB Land Loan program and later use a VA loan to build or purchase a home on a separate property.
For a single home purchase, layering both programs directly is more limited. The VLB does offer down payment assistance options through its Veterans Housing Assistance Program that may be structured alongside a VA first lien in certain scenarios, but the mechanics depend on the specific programs available at the time of application and lender approval. If you are considering combining both, work with a lender experienced in Texas veteran programs to confirm what is currently available and how the two programs interact for your specific transaction.
Can you do a VA cash-out refinance in Texas?
Yes, but Texas imposes restrictions that apply to all cash-out refinancing in the state, regardless of loan type. Under the Texas Constitution (Article XVI, Section 50(a)(6)), a cash-out refinance is treated as a home equity loan and is subject to several rules: you must retain at least 20% equity after the refinance, meaning the maximum loan-to-value is 80%. By comparison, VA cash-out refinances in other states allow up to 100% LTV. The equity restriction is the most significant difference for Texas veterans.
Additional Texas-specific requirements include a mandatory 12-day waiting period after you apply before closing can occur, a three-day right of rescission after closing, a limit of one home equity transaction per 12-month period, and a requirement that the loan close at a title company’s office.
Once a property has been refinanced under Section 50(a)(6), future refinances on that property are also subject to those rules unless the equity loan is paid off entirely. If you have substantial equity and want to access cash, a VA cash-out refinance in Texas is still a strong option, but working with a lender familiar with Texas home equity law is important.
Can you use a VA loan to buy land in Texas?
A standard VA purchase loan cannot be used to buy raw or vacant land on its own. VA financing requires that the property being purchased serve as the borrower’s primary residence, which means an existing home must be on the lot. You cannot use a VA loan to buy land and build later using separate financing.
There are two ways to use VA benefits for land in Texas. The first is a VA one-time close construction loan, which covers the land purchase and home construction in a single loan. Not all lenders offer this product, but it allows you to lock in your rate upfront and avoid separate lot and construction financing.
The second option is the Texas VLB Land Loan Program, which is specifically designed for purchasing land and does not require construction to begin immediately. Veterans who want to buy acreage in Texas without building right away are better served by the VLB land loan, while those ready to build can explore whether a VA one-time close construction loan makes sense for their situation.
Ready to Apply for a Texas VA Loan?
The application process starts with pre-approval: submit your income documentation, authorize a credit pull, and a VA-approved lender will retrieve your COE electronically and confirm your entitlement amount. Apply online or call 262-305-0680. We serve veterans throughout Texas, including San Antonio, Houston, Dallas, Fort Worth, Austin, El Paso, Killeen, Harker Heights, Corpus Christi, Wichita Falls, Abilene, and communities statewide.
VA Loan Example (0% down): $300,000 sales price, $0 down payment, $306,450 loan amount (includes $6,450 first-time use VA Funding Fee), 7.750% interest rate, 7.87% APR, $2,196 principal and interest payment.
VA Loan Example (5% down): $300,000 sales price, $15,000 down payment, $289,275 loan amount (includes $4,275 first-time use VA Funding Fee), 7.750% interest rate, 7.90% APR, $2,074 principal and interest payment.
Taxes, insurance, and mortgage insurance will be part of the total monthly mortgage payment but are not included in the above examples. These examples are for illustrative purposes only and may differ from the current interest rate offered. Call for the current rate and full disclosure of current terms.
Union Home Mortgage Corp. does not provide tax, legal, credit repair, or accounting services.
