I served as a Captain in the U.S. Army Reserve, and helping fellow veterans and service members buy a home matters to me. The VA home loan is one of the most valuable benefits you earned, and in Texas it can pair with state programs many buyers never hear about.
Who is eligible
Eligibility depends on length of service, character of discharge, and whether you served on active duty, in the Reserve or in the National Guard. Some surviving spouses qualify too. Your COE confirms eligibility and entitlement. Request it on VA.gov, or let your lender pull it electronically; most can.
As a Reserve veteran, I know those rules can feel less clear-cut. The COE settles it, so request it early.
What makes a VA loan different
No down payment with full entitlement
With full entitlement, the VA guarantees part of the loan and you can finance up to 100 percent of the price. Since 2020 these borrowers face no VA loan limit, though lenders set maximums based on income and credit. If entitlement is tied up in another VA loan, a pricier home may need a down payment.
No monthly mortgage insurance
Conventional loans with less than 20 percent down and FHA loans carry mortgage insurance. VA loans do not, which can meaningfully lower your payment.
The VA funding fee
Most borrowers pay a one-time fee, set by down payment and first or repeat use, at closing or rolled into the loan. Veterans receiving VA compensation for a service-connected disability are generally exempt, as are certain others, including eligible surviving spouses and active-duty Purple Heart recipients. See the current fee table on VA.gov.
How you qualify
VA lenders review credit, debt-to-income ratio and residual income: the money left each month after major obligations.
Seller concessions
VA rules let sellers pay certain concessions, capped at 4 percent of the home's reasonable value, on top of normal closing costs the seller agrees to cover. They can cover the funding fee, prepaid items or other costs.
The VA appraisal and minimum property requirements
A VA appraiser estimates value and checks that the home meets VA minimum property requirements: safe, structurally sound and sanitary. Common issues include roof condition, peeling paint on older homes, missing handrails, inadequate heating or cooling, and signs of wood-destroying insects. Required repairs usually must be finished before closing.
The VA appraisal is not a home inspection. Hire a TREC-licensed inspector during your option period and use what you learn to negotiate.
Making a strong VA offer in Texas
Some sellers assume VA offers are harder to close. Prepared well, yours competes with any:
- Get fully pre-approved with a lender experienced in VA loans.
- Offer a reasonable option fee and earnest money in the TREC contract.
- Explain the VA appraisal process and timeline to the listing agent up front.
- Ask for concessions where they matter most to you.
Occupancy and multi-unit homes
VA loans are for a home you will live in, generally within a reasonable time after closing. You can buy up to four units if you live in one, so rent from the others helps with the payment. Lenders look closely at that rental income, so plan conservatively. My rental investing guide shows how I analyze those numbers.
Texas programs for veterans
Texas Veterans Land Board home loans
The Texas Veterans Land Board (VLB) offers home, land and home improvement loans for eligible Texas veterans and military members through participating lenders. It sets its own eligibility and terms, and some programs can pair with other financing. Ask a participating lender to compare a VLB loan with a standard VA loan.
Property tax exemptions
Texas offers property tax exemptions for veterans with service-connected disabilities, scaled by disability rating, and a full residence homestead exemption for veterans who receive 100 percent disability compensation or are rated individually unemployable. Certain surviving spouses may qualify too. Apply with the Hidalgo County Appraisal District or the Cameron Appraisal District along with your general homestead exemption.
Selling a home with a VA loan
VA loans are assumable with lender and VA approval. A buyer who assumes your loan takes over its rate and terms, which is attractive when yours is below current rates. The catch: unless the buyer is an eligible veteran who substitutes their own entitlement, yours can stay tied to that loan. Talk with your lender before agreeing to an assumption.
Run the numbers
Estimate a VA payment in the mortgage calculator with no down payment and no mortgage insurance, and set a comfortable range with the affordability calculator. Then book a call. I would be glad to help a fellow veteran.
