Texas Vet Mortgage

What is the Texas Veterans Program?

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 unbeatable, low-interest loan with little or no money down.

The VLB can make a Home Loan for most types of homes. The criteria: ,

• Must be the veteran’s primary residence
• Must be located in Texas
• Must be a single family attached or detached home, town home, or condominium
• Duplexes or other multi-family units must have been constructed at least five years prior to the closing date of the loan.
• Manufactured / modular homes may be eligible. Contact the VLB or participating lender to confirm.
• All new construction homes must meet:
  1. The Environmental Protection Agency’s (EPA) guidelines for ENERGY STAR® qualified homes, and must be ENERGY STAR® labeled and certified; OR
  2. A HERS Index Score of 75 or less following the RESNET National Home Energy Rating Standards and must have an energy rating Certificate that documents the HERS Index score of 75 or less

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.

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.

Efficient homes at great rates . . . 

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.

All new construction homes must meet:

The Environmental Protection Agency’s (EPA) guidelines for ENERGY STAR® qualified homes, and must be ENERGY STAR® labeled and certified;

OR

A HERS Index Score of 75 or less following the RESNET National Home Energy Rating Standards and must have an energy rating Certificate that documents the HERS Index score of 75 or less.

 Disabled veteran?

The VLB offers an interest rate reduction to qualifying veterans with disabilities.

Veterans with disabilities may qualify for an interest rate reduction on their VLB Home or Home Improvement Loans. The veteran must have a compensable 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.  Please contact the VLB if you have any questions.

 Building a house?

The VLB cannot lend interim construction money to build a home. However, a veteran may obtain interim financing from another source to build, and upon completion, finance up to $417,000 of the home through the VLB. This is known as a take-out loan.

A take-out loan may be made to finance a home that qualifies as new construction under the following conditions:

1. The VLB home loan must be used to pay off the construction loan (interim financing).
2. The term of the interim loan cannot exceed 24 months, and the original indebtedness must have taken place within 24 months of the closing date of the VLB home loan.

IMPORTANT: Please note the following:

1. A veteran may occupy the newly constructed residence during the term of the interim loan and still qualify for a take-out loan.
2. Two-to-four family units are not eligible for take-out loans.
3. All new construction homes must meet:
   • The Environmental Protection Agency’s (EPA) guidelines for ENERGY STAR® qualified homes, and must be ENERGY STAR® labeled and certified; OR
   • A HERS Index Score of 75 or less following the RESNET National Home Energy Rating Standards and must have an energy rating Certificate that documents the HERS Index score of 75 or less.