Texas veteran home loans are a way for veterans and active duty service members in Texas to finance the purchase of a home. These loans are offered by the Texas Veterans Land Board (VLB) and are meant to help military members buy a home.
Texas Veteran Home Loan Overview
The Texas Veterans Land Board (VLB) offers veterans and military members competitive interest rates on home loans through the Texas Vet Loan Program. The rates for these loans are competitive with the rates offered by other lenders, and the program is available to qualified veterans and military members who are residents of Texas.
About the Texas VLB
In the early years of the VLB, the agency primarily focused on providing financing for the purchase of rural land for agriculture and ranching. In the 1960s, the VLB expanded its mission to include the provision of home improvement loans and home equity loans to veterans and military members.
The Texas Veterans Land Board (VLB) was created in 1946 by the Texas legislature to assist Texas veterans in purchasing land. The VLB is a state agency that operates under the authority of the Texas General Land Office. The VLB provides financing for the purchase of land, homes, and home improvements to eligible veterans and military members.
In 1983, the Legislature created the VLB Veterans Housing Assistance Program to assist Texas veterans in purchasing a home. Through this program, eligible Texas veterans have an opportunity to purchase a home with an low-interest rate home loan with little or no money down.
Over the years, the VLB has continued to evolve and expand its programs and services to meet the changing needs of Texas veterans and military members. Today, the VLB is a major source of financing for veterans and military members looking to purchase a home or make improvements to their existing home. The VLB is also a valuable resource for veterans and military members seeking financial education and counseling, homebuyer assistance, and mortgage credit certificates.
VLB Loan Programs
The Texas Veterans Land Board (VLB) offers a number of loan programs to help veterans and military members finance the purchase of a home or make improvements to their existing home. Some of the loan programs offered by the VLB include:
- Texas Vet Loan Program: This program provides competitive interest rates on home loans to eligible veterans and military members who are residents of Texas.
- Home Improvement Loan Program: This program provides low-interest loans to help veterans and military members make necessary repairs or improvements to their homes.
- Land Loan Program: This program provides financing to veterans and military members for the purchase of land.
- Home Equity Loan Program: This program provides low-interest loans to veterans and military members who want to use the equity in their homes to make improvements or pay off other debts.
In addition to these loan programs, the VLB also offers a number of other resources and services to help veterans and military members achieve their homeownership goals, including financial education and counseling, homebuyer assistance programs, and mortgage credit certificates.
Texas Veteran Home Loan Benefits
A Texas veteran home loan has some good things about it. One is that it has competitive interest rates, which means it’s not too expensive. Another is that it has flexible terms, which means you can choose how long you want to pay the loan back. You can choose between 15 and 30 years.
There are also no down payment and no private mortgage insurance required with a Texas veteran home loan. This means you can finance the whole cost of the home and not have to pay anything upfront.
To be eligible for a Texas veteran home loan, you must be a veteran or active duty service member who lives in Texas. You also need to have a good credit history and be able to pay the loan back. You’ll need to provide documentation of your military service, like your DD-214 form, and proof of your income and assets.
Texas Veteran Requirements
Texas veterans must find a lender participating in the Veterans Housing Assistance Program (VHAP), and request a Texas Veterans Home Loan application to start the process. Once the application has been completed, it must be returned to the lender.
All borrowers must be approved by the VLB before proceeding with application. Download Certification of Eligibility forms at www.texasveterans.com.
The veteran must occupy the home within 60 days after the closing of the loan, and the home must remain the veteran’s primary residence for at least three years.
Veterans (all of the following must apply):
- Served no fewer than 90 cumulative days on active duty in the Army, Navy, Air Force, Marines, Coast Guard, or US Public Heath Service or recognized reserve component of the listed branches of service.
- Served after September 16, 1940
- Not been dishonorably discharged
- The applicant must 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)
- Unmarried, surviving spouses may qualify.
- Any previous VLB mortgage loan must be paid off prior to closing.
- See www.texasveterans.com for full eligibility requirements.
- Applicaiton: https://www.glo.texas.gov/vlb/_documents/loans/certification-application.pdf https://www.glo.texas.gov/vlb/veterans-benefits/veteran-loans/home-loans/
New Construction Loans
While the VLB cannot provide interim construction financing, Texas veterans can work with participating lenders to use a “take-out” loan when the home is complete.
To be eligible for VLB Home Loan financing, new-construction homes must meet the federal government standards for energy efficiency in the Energy Star™ program or have a HERS index score of 75 or less.
Interest Rate Discounts
Veterans with disabilities may qualify for an interest rate reduction on their VLB Home or Home Improvement Loans. The veteran must have a service-connected disability of 30 percent (30%) or greater as verified by an Award Letter from the Department of Veterans Affairs (VA). The reduction is a full 50 basis points, or one-half of one percent on the available VLB loan interest rate. If you have any questions about the required documentation, please contact the VLB.
Of course, the veteran must also meet all other eligibility requirements for these loans to qualify for the discount.
Unmarried Surviving Spouse Discount
To honor our Texas veterans, the VLB offers a substantial interest rate reduction on Home and Home Improvement Loans to the unmarried surviving spouse of any service member who was killed in the line of duty (service member must have been a legal resident of Texas at the time of death). The reduction is a full 50 basis points, or one-half of one percent on the available VLB loan interest rate.
An unmarried surviving spouse of a veteran who is missing in action, or who died in the line of duty, or died from a service-connected cause and had a compensable service-connected disability rating of 30% or greater (as verified by an Award Letter from the VA) at the time of death and was a legal resident of Texas is also eligible for the discount.
This reduction can result in a savings of tens of thousands of dollars for qualifying applicants. The surviving spouse must meet all other eligibility requirements for the Home and Home Improvement Loan programs.
Closing Costs for VLB Home Loans
The Texas Veterans Land Board (VLB) is a state agency that provides financing to veterans and military members for the purchase of land, homes, and home improvements. The VLB does not charge any fees to process or originate its loans. However, there may be other fees associated with a VLB loan that are charged by third parties, such as appraisal fees, title fees, and recording fees.
It’s important to note that the VLB does not charge any prepayment penalties on its loans, which means that you can pay off your loan early without incurring any additional fees.
Seller Concessions
Seller concessions are credits or contributions that a seller makes towards the closing costs of a home purchase. In the context of a Texas Veterans Land Board (VLB) home loan, the seller concessions that may be allowed depend on the specific terms of the loan.
Generally, the VLB allows seller concessions up to 4% of the purchase price of the home. This means that the seller can contribute up to 4% of the purchase price of the home towards the closing costs, such as title fees, appraisal fees, and other closing expenses.
However, it’s important to note that seller concessions are not always allowed in all circumstances. The VLB may limit or prohibit seller concessions in certain cases, such as when the home is being sold at an above-market price or when the seller is related to the borrower. It’s always best to check with the VLB or your loan officer to confirm whether seller concessions are allowed in your specific case.
Summary
If you are a veteran or active duty service member thinking about buying a home in Texas, a Texas veteran home loan might be a good choice for you. These loans have competitive interest rates, flexible terms, and other benefits that can help you finance your home purchase. If you’re interested in applying for a Texas veteran home loan, you can contact the Texas Veterans Land Board for more information.
Mark Pfeiffer
Branch Manager
Loan Officer, NMLS # 729612
972.829.8639
MortgageMark@MortgageMark.com
We assist clients with all type of mortgage loan programs