Texas Vet Loan: Rates, Eligibility, and How It Works in DFW

What Is the Texas Vet Loan and How Does It Differ from a VA Loan?

The Texas Vet Loan is a rate subsidy program run by the Texas Veterans Land Board (VLB) that layers on top of a federal VA loan to reduce your interest rate by 0.25 to 0.50 percent below the standard VA market rate. Veterans with a 30 percent or higher service-connected disability rating qualify for an additional reduction of around 0.50 percent. On a $400,000 home loan, the lower rate typically saves $85 to $100 per month compared to a standard VA loan.

By Paul Blair | October 14, 2026

Most veterans buying in Dallas, Plano, Frisco, or anywhere across DFW know about the federal VA loan. Zero down. No PMI. Competitive rates. It's one of the best mortgage programs in the country.

What most of them don't know is that Texas has its own program layered on top of it, and it costs nothing extra to use.

The Texas Veterans Land Board home loan program has been running since 1983. It's not a replacement for your VA benefit. It's a subsidy that lowers the rate you'd already get on a VA loan. The VLB sets that rate monthly, and it consistently runs below what you'd find on the open market.

That difference adds up. On a $400,000 loan, the lower rate typically translates to $85 to $100 less per month. That's real money, and it's sitting there unclaimed by veterans who simply didn't know the program existed.

If you already know the basics of the VA loan for DFW buyers, the Texas Vet Loan is the next layer worth understanding.

What the VLB Home Loan Actually Does

The federal VA loan comes with a market rate set by individual lenders. When you use the VLB program alongside it, the state subsidizes a portion of your rate.

As of 2026, the VLB home loan rate runs 0.25 to 0.50 percent below the going VA market rate. The board posts the current rate at vlb.texas.gov, and it updates monthly.

Veterans with a 30 percent or higher service-connected disability rating get an additional reduction of around 0.50 percent on top of that. If you have a combined disability rating in that range, you're looking at a meaningful gap below anything a private lender will quote you.

The home loan ceiling is $832,750. That covers most of the DFW market, though it falls short of some of the higher-end submarkets. For buyers in Plano, Frisco, McKinney, Wylie, or anywhere in the $450,000 to $800,000 range, the cap isn't a limiting factor.

You also keep all the standard VA loan benefits: no down payment requirement, no private mortgage insurance, and the seller can cover your closing costs.

One thing the VLB does not offer: refinancing. The Texas Vet Loan is a purchase program only. Veterans looking to refinance an existing VA loan need to work with a VA-approved lender directly using the VA's IRRRL or a cash-out refinance. That's the federal path, not VLB. This comes up constantly with clients who heard about the program after they already owned a home.

Who Qualifies for the Texas Vet Loan

To use the VLB home loan, you need to meet all of the following:

• Texas resident at the time you apply
• Eligible for a federal VA loan (sufficient VA entitlement, service requirements met)
• Buying a primary residence
• Move in within 60 days of closing
• Stay in the home for at least three years

The three-year occupancy requirement is the one that trips people up. The VLB program is designed for buyers who are settling into a home, not for someone expecting a corporate transfer in two years. If your timeline is uncertain, a standard VA loan through a private lender gives you more flexibility.

Surviving spouses of eligible veterans may also qualify. Check vlb.texas.gov for the current eligibility rules, since they track with federal VA guidelines and can update.

What Else the VLB Offers

The Veterans Land Board runs two other programs that come up in DFW transactions.

The VLB land loan lets eligible veterans buy undeveloped Texas land with as little as 5 percent down, up to $200,000 (or $275,000 if two eligible veteran spouses are both on the loan). Terms run 30 years. For buyers looking at acreage in Celina, Prosper, Anna, or further north where raw land is still available, this is the state-backed alternative to conventional lot financing.

The VLB home improvement loan covers renovations and repairs on a primary residence, up to $50,000, with no down payment required. Terms range from 2 to 20 years. Veterans buying older homes in Lake Highlands, Lakewood, or the M Streets and planning immediate work have a low-cost financing option through this program that most conventional renovation loans can't match.

These aren't alternatives to the home loan. They're separate programs that can potentially work alongside a purchase.

How to Use the Texas Vet Loan in DFW

Not every lender participates in the VLB program. You have to use a VLB-approved lender, and your agent should be able to point you to several who are active in DFW.

The loan still goes through standard federal VA underwriting. You'll need a Certificate of Eligibility from the VA, and the VA process applies throughout: appraisal, title work through a Texas title company, and the option period if your contract includes one. The VLB layer adds the rate benefit without fundamentally changing how the transaction runs.

Three things to do before you start shopping:

1. Get your Certificate of Eligibility from the VA, or ask your lender to pull it.
2. Confirm your current disability rating if you're near 30 percent. The additional discount requires documentation.
3. Check the current VLB rate at vlb.texas.gov so you have a reference point before lenders start quoting you.

When you're comparing offers, ask each VLB-participating lender for their rate with the subsidy applied. The lender's base rate is where they start. The VLB subsidy is what makes the number meaningful.

The DFW market runs fast in the suburban price ranges where most veteran buyers are active. Frisco, McKinney, and Wylie at $500,000 to $700,000 are competitive. Getting your financing structure dialed in before you start writing offers is one of the most important things you can do, and using the VLB program costs you nothing extra to access.

If you're also eligible for the Texas disabled veteran property tax exemption, that's a separate benefit worth stacking. Veterans with a 100 percent disability rating can qualify for a full property tax exemption in Texas, which on a $600,000 home in Collin County can eliminate $10,000 or more per year in taxes. I covered that program in detail in this post.

Frequently Asked Questions

Can I use the Texas Vet Loan without a VA loan?

No. The VLB home loan is a rate subsidy that runs alongside a federal VA loan. You need VA eligibility and the VA loan product for the benefit to apply. If you don't have VA eligibility, the VLB home loan isn't available to you.

How much can I save with the Texas Vet Loan compared to a regular VA loan?

The VLB rate typically runs 0.25 to 0.50 percent below the standard VA market rate. On a $400,000 loan, that translates to roughly $85 to $100 per month. Veterans with a 30 percent or higher service-connected disability rating get an additional reduction of around 0.50 percent, which pushes the savings higher.

Does the Texas Vet Loan have a loan limit?

Yes. The VLB home loan limit is $832,750 as of 2026. This covers the majority of the DFW market. Check vlb.texas.gov for the current figure, since it can adjust.

Can I use the Texas Vet Loan to buy a second home or investment property?

No. The VLB home loan is restricted to your primary residence. You must move in within 60 days of closing and occupy the home for at least three years. Investment properties and second homes are not eligible.

I already own a home in DFW. Can I use the VLB to refinance my current mortgage?

No. The VLB does not offer a refinancing product. The Texas Vet Loan is for purchase transactions only. Veterans looking to refinance an existing VA loan should look at the VA's IRRRL program through a VA-approved lender.

If you're a veteran buying in the Dallas area and want to talk through whether the VLB program fits your situation, reach out directly. Getting the financing structure right before you start shopping is one of the most important parts of the process.

About Paul Blair

Paul Blair is the founder and broker of Grey Square, a virtual real estate brokerage representing buyers and sellers across Dallas and Los Angeles. With 22 years in the business and more than $200 million in closed transactions, Paul works the full range of the market, from luxury homes in the Park Cities and Preston Hollow to estates in the Hollywood Hills and across the Westside. Connect with Paul and the Grey Square team at greysq.com. TX TREC #9011505 · CA DRE #01792671.