VA Construction Loans in Texas

What’s different about VA loans in Texas

Property taxes: the number that matters most in Texas

Texas has no state income tax, so schools, counties and cities are funded by local property taxes, and they are a large part of every Texas mortgage payment. Three things lower them:

• Homestead exemption. Once the home is your primary residence, file with your county appraisal district. Voters raised the school-district homestead exemption to $140,000 in November 2025.
• Disabled-veteran exemption. Veterans rated 100% disabled, or paid at the 100% rate for individual unemployability, pay no property tax on their homestead. Partial ratings get a fixed exemption: $5,000 (10–29%), $7,500 (30–49%), $10,000 (50–69%) or $12,000 (70% and up, or age 65+ with at least a 10% rating). Unremarried surviving spouses can qualify too.
• MUD and PID taxes. Many new neighborhoods around Austin, Houston, San Antonio and Dallas–Fort Worth sit in a municipal utility district (MUD) or public improvement district (PID) that adds to the tax rate. Ask for the total tax rate, not just the county rate, before you compare homes.

Tell Shirley your disability rating up front so your payment estimate uses the tax number you will actually pay.

Texas is a community-property state

If you are married, VA requires your spouse’s debts to be counted when you qualify, even if your spouse is not on the loan. A credit report is pulled for them, and their monthly payments are included in your ratios. Their income is not counted unless they are on the loan.

Texas homestead law also requires your spouse to sign the deed of trust at closing, even if they are not a borrower. Plan for both of you to be at closing, or arrange a power of attorney early if one of you is deployed.

Texas Veterans Land Board programs

The Texas Veterans Land Board (VLB) runs state programs that can work alongside your federal VA benefit:

• Veterans Housing Assistance Program (VHAP): home loans up to $832,750 (effective January 5, 2026) through VLB participating lenders. It can be paired with a VA loan for $0 down, and veterans rated 30% or more get a reduced interest rate.
• Veterans Land Loan Program: land loans up to $200,000, or $275,000 for a dual-spouse loan (effective February 9, 2026), for one acre or more with 5% down.

The VLB rate is not always the best deal once it is compared side by side with a regular VA loan. Ask Shirley to price both.

Texas closing costs

Texas has no state mortgage tax or transfer tax. The biggest closing-cost items are title insurance and escrow fees. Title insurance premiums in Texas are set by the Texas Department of Insurance, so the base premium is the same at every title company; escrow and other fees still vary. A survey is often required, and an existing survey from the seller can sometimes be reused.

Building a home in Texas

• Builder. Texas has no statewide license for home builders, so experience and track record matter most. Some cities require builders to register, and VA no longer requires a builder ID.
• Homestead rules. Texas protects homesteads from liens, so the lien for building a home must come from a written contract signed before work starts, by you and your spouse. The loan documents and builder contract are set up to meet this; it is one reason the paperwork must be signed in the right order.
• Foundations. Expansive clay soils are common across much of Texas, so expect an engineered foundation plan and soil report as part of the build.
• Land you already own. If you bought land first, including with a VLB land loan, the construction loan can generally pay off the land loan at closing so you end up with one mortgage. Bring your land payoff to the first call.
• New neighborhoods. Many new-build lots are in a MUD or PID, which adds to your property tax rate. That affects your payment and what you qualify for, so it is worth checking before you choose a lot.