Do You Qualify for a VA Loan in Texas?
The VA loan is the most powerful mortgage benefit available to veterans, but it comes with specific requirements. Understanding them upfront saves time and helps you prepare. This guide covers every requirement you need to meet to buy a home in Texas using a VA loan in 2024.
1. Service Eligibility Requirements
The first requirement is military service. You must meet at least one of the following:
Active Duty Service Members:
- 90 consecutive days of active duty during wartime, OR
- 181 continuous days during peacetime
Veterans:
- Discharged under conditions other than dishonorable
- Minimum active duty service based on your era (post-9/11 veterans typically need 90 days)
National Guard and Reserve Members:
- 6 years of service in the Selected Reserve or National Guard, OR
- 90 days of active duty under Title 10 orders (not Title 32)
- Discharged honorably or placed on the retired list
Surviving Spouses:
- Unremarried spouse of a veteran who died in service
- Unremarried spouse of a veteran who died from a service-connected disability
- Spouse of a service member listed as missing in action or prisoner of war
2. Certificate of Eligibility (COE)
Once you confirm service eligibility, you need a Certificate of Eligibility (COE). This document proves to your lender that you are entitled to VA loan benefits. You can obtain it three ways:
- Online: Through VA.gov eBenefits portal
- Through your lender: Most VA lenders pull it instantly through the VA's automated system
- By mail: VA Form 26-1880 submitted to the VA
For most Texas veterans, your lender will pull the COE during the pre-approval process at no cost to you.
3. Credit Score Requirements
The VA itself does not set a minimum credit score. However, individual lenders in Texas impose their own standards:
| Credit Score | Likelihood of Approval |
|---|---|
| 580–619 | Limited lenders; may require compensating factors |
| 620–659 | Most VA lenders will approve |
| 660–719 | Strong approval odds; competitive rates |
| 720+ | Best rates and fastest processing |
If your credit score is below 620, spend 3–6 months paying down revolving balances, disputing errors, and making on-time payments before applying.
4. Income and Employment Requirements
Lenders verify that you have stable, reliable income sufficient to repay the loan. Requirements include:
- Employment history: Generally 2 years of steady employment or active duty service
- Self-employed veterans: 2 years of tax returns required
- Military income: LES (Leave and Earnings Statement) used to verify pay, BAH, and BAS
- Retired military: Award letter and 1099-R for pension income
Debt-to-Income Ratio (DTI)
VA guidelines suggest a maximum DTI of 41%, but lenders routinely approve higher DTI ratios when other factors are strong. Many Texas VA lenders approve up to 55–60% DTI for well-qualified borrowers.
Residual Income
The VA uniquely requires residual income — the money left over after paying all monthly obligations. For a family of four in Texas (South region), the VA requires a minimum of $1,003/month in residual income. This requirement catches borrowers who technically meet DTI limits but have too little left for living expenses.
5. Property Requirements
The home you purchase must meet VA Minimum Property Requirements (MPRs):
- Structurally sound foundation, roof, and walls
- Working electrical, plumbing, and HVAC systems
- No active pest infestations (termite inspection required in Texas)
- Safe and accessible from a public or private road
- Adequate living space and sanitary conditions
Most standard Texas homes in good condition easily pass. Properties needing significant repairs may require fixes before closing.
6. Occupancy Requirement
VA loans are for primary residences only. You must intend to occupy the home as your primary residence within 60 days of closing in most cases. Investment properties and vacation homes do not qualify — though you can later convert the home to a rental after moving out.
7. VA Funding Fee
Most veterans pay a one-time VA funding fee at closing:
- First use, 0% down: 2.15% of the loan amount
- Subsequent use, 0% down: 3.30%
- First use, 5%+ down: 1.50%
The fee is waived for veterans with a VA disability rating of any percentage, surviving spouses receiving DIC, and active duty Purple Heart recipients.
Frequently Asked Questions
Yes, but waiting periods apply. Chapter 7 bankruptcy requires a 2-year waiting period from discharge. Foreclosure typically requires a 2-year waiting period from the date of the foreclosure sale.
Yes. A non-veteran spouse's income can be used to help qualify for the loan. However, the veteran must be a borrower on the loan to use VA benefits.
No. The VA loan has no maximum income limit. You simply need to demonstrate sufficient stable income to repay the loan and meet the VA's residual income requirement.
