Texas Veterans Land Board
In 1983, the Texas Legislature created the Texas Veterans Land Board (VLB) Veterans Housing Assistance Program (VHAP) to assist Texas Veterans in purchasing a home. The main goal of this program is to help Texas Veterans, military members and their families save money on their home mortgages and here are some of the ways the VLB and other organizations help them do that:
- Eligible Texas Veterans and military members can take advantage of their federal housing benefits through the U.S. Department of Veterans Affairs (VA), and their state benefits through the VLB, at the same time. The VLB’s interest rate on a VA-backed home loan is very competitive with other home loan interest rates. Through the VLB program Veterans with a VA disability rating of 30% or greater receive an even better interest rate with an additional .50% reduction on the existing VLB interest rate.
- Texas Veterans with a 10% or greater service-connected disability rating from the VA are eligible for property tax exemptions. A full property tax exemption is available for Veterans with a 100% disability rating from the VA. If a Veteran qualifies for a property tax exemption they may have more monthly income to qualify for a mortgage.
- Texas Veterans with a VA disability rating of at least 10% don’t have to pay the VA funding fee at closing. The VA funding fee can be between 1.25% and 2.15% of the loan amount for a Veteran’s first VA-backed mortgage. The fee variation is dependent on the amount of the down payment.
- The VLB’s participating home loan lenders typically require that Veteran borrowers have at least a minimum credit score of 620 to qualify for a VLB home loan of up to $484,350.
- Texas Veterans who want to build a new home must first obtain a construction loan to pay the home builder. While the VLB can’t pay a home builder directly, it can fund the mortgage on a completed home. Most banks and credit unions that offer home construction loans typically require the borrower to have excellent credit history and pay a security deposit of at least 10% to 20% of the construction cost.
- A Texas Veteran or military member may roll a land loan into a VLB home loan on a newly constructed home at a total not to exceed $484,350. A Texas Veteran or military member who has a balance on a land loan — whether through the VLB or a private lender — may pay off that land loan with a VLB-funded home loan once new construction is complete. Alternatively, an existing home located on acreage may be surveyed in a manner that allows a Texas Veteran or military member to take advantage of their home and land loan benefits simultaneously.
To be eligible for VLB loan programs, Veterans and Military Members must be:
- At least 18 years of age.
- A bona fide and legal resident of Texas on the date of application and meet one of the following service criteria:
- An active duty Military Member.
- A member of the Texas National Guard.
- A reserve component Military Member having completed 20 qualifying years for retirement.
- A Veteran having served at least 90 active duty days unless discharged sooner due to a service-connected disability and not discharged dishonorably.
- A surviving spouse of a Veteran listed as missing in action or whose death was service connected.
To qualify, homes must meet the following requirements:
- The home must be the Veteran or Military Member’s primary residence in Texas.
- The home must be a single family attached or detached home, townhome or condominium.
- Duplexes or other multi-family units must have been constructed at least five years prior to the closing date of the loan.
- New homes must have either ENERGY STAR certification or HERS Index score of 75 or less.
- The home must remain the Veteran or Military Member’s primary residence for at least three years, and the Veteran or Military Member borrower must occupy the home within 60 days after loan closing.
The VLB does not offer to refinance. If you have an existing loan on your home, the VLB cannot provide refinancing to lower your interest rate, nor can the VLB Veterans Housing Assistance Program be used for a down payment on a home.
The VLB Veterans Housing Assistance Program provides Veterans and Military Members with loans, where VLB is in first lien position of the primary residence. It’s possible for a Veteran or Military Member to have one active loan in each program — land, home, and home improvement — at the same time.
Once a Veteran, or his or her successor, has successfully paid off a VLB home loan s/he may obtain another VLB home loan. The same applies to the VLB Land Loan Program. All VLB programs are self-funded, using no public taxpayer funding. VLB programs are financed with bonds, which are serviced by loan payments from Veteran and Military Member participants.
*All VLB interest rates and available discounts are subject to change at any time. The VLB base rate is subject to adjustment on the first business day of each week. All VLB loans are subject to credit approval.