Texas veteran home loans
Texas runs its own lending programs for veterans, separately from the federal VA loan, including the only state land loan of its kind in the country. What the state offers, what the VA loan does and does not do, and the funding fee most people find out about late.
What does Texas offer veterans that the VA does not?
Its own lending board. The Texas Veterans Land Board sits inside the General Land Office and runs loan programs that are separate from the federal VA loan, and a veteran can use both. The one almost nobody outside the state knows about is the land loan, which the GLO describes as the only one of its kind in the nation. Brad raises it unprompted in class because so few veterans in the room have heard of it: "there's another program really quickly for my veterans in the room, you have a 5% down program that will let you buy bald land."
- Land loan: borrow up to $200,000 toward land, minimum five percent down, on tracts of one acre or more.
- Two veteran spouses who each qualify separately may borrow up to $275,000 on the same tract, still at a minimum five percent down.
- Home loan: the VLB Veterans Housing Assistance Program, created by the Legislature in 1983, which the GLO describes as low-interest with little or no money down.
- Reservists and National Guard members with a VLB land or home loan may be able to defer interest when called to active duty, under the Servicemembers Civil Relief Act.
- Source, and the page that carries the current rates: glo.texas.gov
| Program | What it buys | Minimum down | Ceiling |
|---|---|---|---|
| VLB land loan | Land, tracts of one acre or more | 5% | $200,000 |
| VLB land loan, two eligible veteran spouses | One tract, minimum one net acre | 5% | $275,000 |
| VLB home loan (Veterans Housing Assistance Program) | A home | GLO states little or no money down | See the GLO page |
What should a veteran know about the VA loan itself?
Two things that tend to arrive late. The first is the funding fee: on most VA loans there is one, and it is generally rolled into the loan rather than paid at closing, which is convenient and also means it is easy not to notice. Brad's view, from watching it happen, is that some lenders are not as loud and clear about that as they should be. It is worth asking your lender to show you the fee as a figure rather than as a line inside the loan amount.
And who can be on the loan with you is narrower than on other loans
A VA loan is generally limited in who may be a co-borrower alongside the veteran, which is usually a spouse or another entitled veteran rather than any willing relative. That is worth establishing before an offer rather than after, because it changes whose income counts and therefore what the household can carry. Ask the lender to confirm the rule for your specific situation; nothing here is a determination of eligibility.
Can a veteran use a state program and a state assistance program together?
Often, and this is where the stacking question gets interesting. The VLB programs are separate from the statewide down payment assistance programs, and TSAHC also runs a targeted programme for veterans and other service professions. Whether a particular combination works depends on the specific programmes and on the lender, which is exactly the kind of question the free class exists to work through against a real address. Nothing here is an approval, and a lender decides what a lender decides.
Want this checked against your own situation?
The free class covers the whole picture in 45 minutes. Or take two minutes and see which programs are worth a look for someone in your position.