Texas veterans can stack benefits that most states do not offer. A VA loan can build the home with no down payment and no monthly mortgage insurance. The Texas Veterans Land Board lends up to $200,000 to buy an acre or more. Disabled veterans may add housing grants, a waived funding fee and property tax exemptions, up to the full homestead at a 100% rating. Each benefit has its own rules, so the order matters.
We are a builder, not a lender. The VA, the Veterans Land Board and your lender decide eligibility, and programs change. Thank you for your service; we are glad to walk you through how these fit a build.
How does a VA construction loan work?
The VA lists building a new home among the uses of its purchase loan. For eligible veterans, service members and some surviving spouses:
- $0 down and no monthly mortgage insurance.
- No loan limit with full entitlement.
- A one time funding fee, usually financed: 2.15% on a first use with less than 5% down, 1.5% with 5% down, 1.25% with 10% down, and 3.3% on a later use with less than 5% down. If you receive VA compensation for a service connected disability, the fee is waived.
- An appraisal from plans. When it happens before the foundation is finished, the VA appraiser works from your plans and specifications.
- Minimum property requirements, which the home has to meet by final inspection or certificate of occupancy.
The practical hurdle is the lender. Many lenders make VA purchase loans; fewer make VA construction loans. A one time close sets your permanent financing before construction starts, but not every lender offers it. We can introduce you to local lenders who do this work.
What changed for builders in 2025?
Since March 31, 2025, a builder no longer needs a VA issued identification number for most VA financed new construction (VA circular). That opens the door to more builders, and it shifts some weight onto you: the same circular says the VA “will provide Veterans with resources for resolving complaints about builders instead of interceding.”
So your contract, your local inspections and your builder’s written warranty matter more. Our seven questions for choosing a builder are a good checklist. One exception: Specially Adapted Housing grants still require the builder ID, so raise it early if you plan to use one.
What does the Texas Veterans Land Board add?
The Veterans Land Board is a Texas program, separate from the federal VA, with two loans that matter for a build:
| Land loan | Home loan | |
|---|---|---|
| Purpose | Buy land | Permanent mortgage on your home |
| Maximum | $200,000; $275,000 when both spouses qualify | $832,750 |
| Minimum tract | One acre | Not applicable |
| Down payment | At least 5%, subject to credit | Ask a participating lender |
| Term | 30 year fixed; 7.25% as posted in 2026 | 15 to 30 year fixed; a discount at a 30% or higher disability rating |
| New construction | Not applicable | Must meet local building standards |
Three things to keep straight:
- The land loan buys land, not the house. You still need a construction loan. It also requires at least an acre, so most city lots do not qualify.
- The board does not finance construction. A 2016 Texas A&M overview described the home loan as paying off a construction loan of up to 24 months once the house is done. Confirm the current rule with a participating lender.
- The home loan cannot serve as a down payment, and a land lien has to be dealt with when the construction loan closes. Ask how your lender handles it before you buy.
You must be a Texas resident when you apply and meet the service criteria.
What if I have a service connected disability?
Property taxes. Texas exempts part of a disabled veteran’s property value, set by rating, under Tax Code section 11.22:
| VA disability rating | Exemption from appraised value |
|---|---|
| 10% to 29% | $5,000 |
| 30% to 49% | $7,500 |
| 50% to 69% | $10,000 |
| 70% to 100% | $12,000 |
A veteran with a 100% rating, or rated individually unemployable, can receive a total exemption on the residence homestead under section 11.131, and an unremarried surviving spouse may keep it. Each of these is filed with your appraisal district; it is not automatic. Our guide to property taxes on a new home explains the first two years on the tax roll.
Housing grants. The VA’s Specially Adapted Housing and Special Home Adaptation grants help with a home built around a disability, and the VA says the money can be used to “buy, build, or change your permanent home.” For fiscal 2026 the maximums are $126,526 and about $25,350. New amounts for fiscal 2027 usually arrive in the fall, so check before you budget.
Designing accessibility in costs far less than adding it later: zero threshold entries, 36 inch clear doorways, curbless showers and blocking for grab bars are easy to draw at the start.
How does it fit together, step by step?
- Get your Certificate of Eligibility. A lender can usually pull it for you.
- Prequalify with a lender who closes VA construction loans. It usually takes one to three business days.
- Sort out the land. If you own it, its equity may help with closing costs or the budget. If you are buying acreage, compare a Veterans Land Board loan with including the land in your VA loan. Check our land buying guide first.
- Design and price the home. Your blueprints are free with the purchase of your home, and allowances are priced before anything is ordered.
- Close and build. Construction runs about six months from loan closing to keys.
- File your exemptions. Homestead first, then any disability exemption.
Can I also use down payment assistance?
Often you will not need it with a VA loan, but it can help with closing costs. TDHCA’s My First Texas Home waives its first time buyer rule for qualified veterans, and TSAHC’s Homes for Texas Heroes includes veterans. See our down payment assistance guide.
Frequently asked questions
Do I need to be a Texas resident?
For the Veterans Land Board, yes, when you apply. The federal VA loan has no such rule, though the home must be your primary residence.
Can I use a VA loan more than once?
Yes. Later uses carry a higher funding fee unless you are exempt, and your remaining entitlement can affect your loan limit.
Can I build a barndominium with a VA loan?
Sometimes. The home must meet VA minimum property requirements, and the appraiser needs comparable sales. Talk to the lender before you settle on the plan. See our barndominium floor plans.
Do you work with VA loans?
Yes. We do not lend, but we build with VA financing, prepare the budget and draw schedule your lender needs, and coordinate draw requests during the build. Schedule a consultation or get prequalified to start.
