How to Build a Modern House in Texas Using a VA Loan

The allure of building a modern home in Texas is a dream for many veterans and active-duty service members. Texas, with its vast landscapes, booming cities, and rich cultural heritage, offers the perfect backdrop for a home that blends contemporary design with Southern charm. Fortunately, with the benefits provided by VA loans in Texas, this dream can become a reality. VA loans are a unique financing option that allows eligible veterans, active-duty service members, and certain members of the National Guard and Reserves to build or buy homes with favorable terms. Here’s a comprehensive guide on how to build a modern house in Texas using a VA loan.

Understanding VA Loans in Texas

The VA loan program, established by the U.S. Department of Veterans Affairs, is designed to make homeownership more accessible for military members. VA loans offer numerous advantages over traditional mortgages, such as no down payment requirements, competitive interest rates, and no private mortgage insurance (PMI). In Texas, where the cost of living varies greatly between urban and rural areas, these benefits can make a significant difference when building a modern home.

Key Benefits of VA Loans in Texas

No Down Payment Required: One of the most significant advantages of VA loans in Texas is the ability to finance 100% of the home’s value. This means eligible borrowers can avoid the burden of saving for a large down payment, which is especially beneficial in today’s housing market.
Lower Interest Rates: VA loans generally offer lower interest rates compared to conventional loans. This can save you thousands of dollars over the life of the loan, making your modern Texas home more affordable in the long run.
No PMI: Unlike conventional loans that require private mortgage insurance when the down payment is less than 20%, VA loans do not require PMI. This results in lower monthly payments and more savings.
Flexible Credit Requirements: While a good credit score is always beneficial, VA loans are more lenient with credit requirements. This flexibility allows more veterans and service members to qualify for financing.
Closing Cost Limit : VA loans limit the amount of closing costs that veterans can be charged, further reducing the financial burden of building a new home.

Steps to Building a Modern Home in Texas with a VA Loan

Building a home from the ground up can seem like a daunting task, but with careful planning and the right team, it can be a rewarding experience. Here are the steps to building a modern home in Texas using a VA loan:

Determine Your Budget

Before you start designing your modern dream home, it’s essential to understand how much you can afford to spend. This involves more than just determining the loan amount you qualify for; you also need to consider the cost of land, construction, permits, and any unexpected expenses that may arise.

Get Preapproved: The first step is to get preapproved for a VA loan. This will give you a clear idea of your borrowing power and set the stage for the rest of the process. During preapproval, the lender will evaluate your income, credit history, and other financial factors.
Factor in Land Costs: If you don’t already own land, you’ll need to include the cost of purchasing a lot in your budget. Land prices in Texas can vary widely depending on location, so it’s important to research the areas you’re interested in.
Consider Additional Costs: Building a modern home often involves additional expenses such as architectural fees, interior design, and landscaping. Be sure to account for these when setting your budget.

Find the Right Builder

Choosing the right builder is crucial when constructing a modern home. You’ll want to work with a contractor who has experience with VA loans and understands the requirements of building a home under this program.

VA-Approved Builders: Not all builders are approved by the VA, so it’s important to choose one who is. VA-approved builders are familiar with the specific requirements and processes involved in constructing a home using VA financing.
Research and Interview: Take the time to research potential builders and ask for references from previous clients. Interview several builders to ensure they understand your vision and can deliver the quality of work you expect.
Check Licensing and Insurance: Ensure the builder is licensed and insured to work in Texas. This protects you in case of any issues during the construction process.

Design Your Modern Texas Home

Designing a modern home is one of the most exciting parts of the process. Modern homes are characterized by clean lines, open spaces, and an emphasis on natural light and materials. In Texas, this style can be adapted to suit the local climate and landscape.

Work with an Architect: Collaborating with an architect who specializes in modern design is essential. They can help bring your vision to life while ensuring the home is functional and efficient.
Incorporate Energy Efficiency: Texas is known for its hot summers, so it’s important to incorporate energy-efficient features into your design. Consider using high-quality insulation, energy-efficient windows, and solar panels to reduce energy costs.
Plan for Outdoor Living: Texas weather is perfect for outdoor living spaces. Consider incorporating a patio, deck, or outdoor kitchen into your design to take advantage of the state’s mild winters and warm evenings.

Secure VA Construction Financing

VA loans can be used for both buying and building homes, but securing a VA construction loan is a bit different from obtaining a traditional mortgage. Here’s what you need to know:

Construction-to-Permanent Loan: Most VA construction loans are structured as construction-to-permanent loans. This means the loan initially covers the cost of construction, and once the home is built, it converts to a standard VA mortgage.
Choose a Lender Experienced with VA Construction Loans: Not all lenders offer VA construction loans, so it’s important to find one that does. These lenders are familiar with the unique aspects of financing new construction under the VA loan program.
Submit Detailed Plans and Budget: To secure financing, you’ll need to provide the lender with detailed plans and a budget for your project. The lender will review these to ensure they meet VA requirements and are within your loan amount.
Inspections and Draw Schedule: During construction, the lender will require inspections at various stages to ensure the work is progressing as planned. Funds are released in stages (known as draws) to pay for the construction work as it is completed.

Complete the Construction Process

Once your financing is in place, the construction process can begin. This stage requires careful coordination between you, your builder, and your lender.

Regular Site Visits: Stay involved in the process by visiting the construction site regularly. This allows you to ensure the work is meeting your expectations and catch any issues early.
Manage Changes: Changes to the original plans can impact your budget and timeline. Work closely with your builder to manage any changes and ensure they are approved by the lender.
Final Inspection and Occupancy: Once construction is complete, a final inspection will be conducted to ensure the home meets VA standards. After the inspection is passed, you can move into your new modern Texas home.

Conclusion

Building a modern home in Texas using a VA loan is a great way to create a personalized living space that meets your needs while taking advantage of the benefits offered to veterans and service members. By understanding the process and working with experienced professionals, you can navigate the complexities of construction financing and bring your dream home to life. Whether you envision a sleek, contemporary design in the heart of Austin or a modern ranch-style home in the Texas Hill Country, a VA loan can help make your vision a reality. If you need help with property management, a company like 360 Realty Management can help with this. Embrace the opportunity to build a home that reflects your style and enjoys the unique lifestyle that Texas has to offer.

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More Recommended Ebike/Scooters

Check out these other ebikes and scooters I've reviewed:

Urban Arrow Ebike – Last year, I made one of the largest purchases I’ve ever made – I bought a $9,000 electric cargo bike from Urban Arrow. In my Urban Arrow review, I will discuss what it is and why I decided to buy this bike, as well as discuss how impactful a bike like this can be on your journey to financial independence.
Troxus Explorer Step-Thru Ebike – The Troxus Explorer Step-Thru is a fat-tire ebike that I’ve had the pleasure of riding for a while now. It has amazing power, great looks, and awesome range. If you’re looking for a great fat-tire ebike that offers a lot for the price, the Troxus Explorer Step-Thru is definitely one for you to consider. Check out my Troxus Explorer Step-Thru Review.
Hovsco HovBeta Ebike – The HovBeta is a folding ebike with great specs and a lot of interesting features, and importantly, it’s sold at a good price point. I’ve had a blast commuting with it and using it to do deliveries with DoorDash, Uber Eats, and Grubhub. Check out my Hovsco HovBeta Ebike Review.
Vanpowers Manidae Ebike – The Vanpowers Manidae is a fat tire ebike that I’ve been riding as my primary winter commuting bike and have also been using it to do food delivery with apps like DoorDash, Uber Eats, and Grubhub. After clocking in a decent number of miles with this ebike, I wanted to write a post sharing what my experience with the Vanpowers Manidae ebike has been like. Check out my Vanpowers Manidae Review.
Sohamo S3 Step-Thru Folding EBike Review – A Great Value Folding Ebike – The Sohamo S3 Step-Thru Folding Ebike is an entry-level folding ebike that offers a lot of value for the price point. I’ve been riding the Sohamo S3 for a while now, putting the bike through its paces, and I have to say, this bike has exceeded all of my expectations. Check out my Sohamo Review.
KBO Flip Ebike – The KBO Flip is an excellent bike. I’ve had a great time riding it and think it’s a versatile bike that can be used for a lot of purposes and can fit a variety of lifestyles. It’s worked out great for me as a general commuter bike and as a food delivery bike. Check out my KBO Flip Review.
Hiboy P7 Commuter Ebike – The Hiboy P7 is an excellent electric commuter bike that’s offered at an affordable price point. The range and speed of this bike are both very good, so you won’t have any trouble getting anywhere you need to go with it. As a food delivery vehicle, this is also good – with how much range it offers, you’ll be able to work all day on a single charge. Check out my Hiboy P7 Commuter Electric Bike Review.
Himiway Escape Ebike – The Himiway Escape is an interesting bike for anyone looking for a moped-style ebike. If you’re a gig economy worker, the Himiway Escape is particularly interesting and it’s possible to think of it as an investment, especially if you can opt to do deliveries with the Himiway versus using a car. It’s not cheap, but you can definitely make your money back when you compare the mileage you’ll put on your car versus using an ebike. Check out my Himiway Escape Bike Review.
Espin Sport Ebike – The Espin Sport is a good ebike for someone who is looking for an ebike that feels and rides more like a regular bike. There are many ebikes that are really only bikes in name. In reality, they’re basically electric mopeds. The Espin Sport, by contrast, is a bike you could probably ride without the battery and you’d feel like you’re just riding a regular bike. Check out my Espin Sport Review.
Varla Eagle One Scooter – The Varla Eagle One is an excellent scooter that can make sense for a lot of people. It can work as a primary mode of transportation. You can use it to work on gig economy apps like DoorDash, Uber Eats, and Grubhub. And it can also be a recreational vehicle if you’d prefer to use it for that. Check out my Varla Eagle One Review.
Varla Falcon Scooter – The Varla Falcon is an excellent scooter that offers a good amount of power at a lower price point compared to more powerful scooters. It’s not exactly an entry-level scooter, nor is it a high-powered scooter. I think it fits somewhere in-between those two categories – an intermediate scooter if I had to give it a category. Check out my Varla Falcon Review.
Hiboy S2 Scooter – The Hiboy S2 is an excellent entry-level commuter scooter that's perfect for someone looking to save some money in transportation costs and improve their commute. Check out my Hiboy S2 Review.
Hiboy S2R Scooter – The Hiboy S2R is one of the more interesting electric scooters I’ve been able to test out. It’s not a high-powered scooter, but for an everyday transport option, it’s very useful, especially given some of the unique features that it has. Indeed, for the price, the Hiboy S2R might be the best value scooter I’ve used. Check out my Hiboy S2R Review.
Fucare H3 Scooter – The Fucare H3 is a fun scooter and I’ve enjoyed testing it out. For a daily commuter or quick trips or errands, the Fucare H3 is probably the scooter I’ll use. It’s portable and easy to maneuver, so it’s just easier to take on the road when I need it. Check out my Fucare H3 Scooter Review.

More Recommended Investing App Bonuses

For additional investing app bonuses, be sure to check out the ones below:

M1 Finance ($100) – This is a great robo-advisor that has no fees and allows you to create a customized portfolio based on your risk tolerance. You also get $100 for opening an account. Check out my M1 Finance Referral Bonus – Step-By-Step Guide.
SoFi Invest ($25) – SoFi Invest is an easy brokerage account bonus that you can earn with just a few minutes of work. Use my SoFi Invest referral link, fund your SoFi Invest brokerage account with just $10 and you’ll get $25 of free stock. I also have a step-by-step guide for the SoFi Invest referral bonus.
Webull (20 free stock shares) – Webull's current promotion gives you 20 free shares valued between $3-$3,000 each if you open an account using my referral link. Here’s a guide I wrote about how to earn your free shares using Webull.
Moomoo (15 free stocks) – Moomoo is a free investing app currently offering 2 different referral bonuses if you open an account using a referral link. Read my Moomoo referral bonus guide for more information.
Robinhood (1 free stock) – Robinhood gives you a free stock valued between $2.50-$225 if you open an account using my referral link.
Public (1 free stock) - Public gives you a free stock valued between $3-$70 if you open an account using my referral link.

More Recommended Bank Account Bonuses

If you’re looking for more easy bank bonuses, check out the below options. These bonuses are all easy to earn and have no fees or minimum balance requirements to worry about.

Upgrade ($200) – Upgrade is a free checking account that’s currently offering a $200 referral bonus if you open an account and complete a direct deposit. These bonus terms are easy to meet, so it’s well worth doing this bonus as soon as you can. Here’s a post I wrote with more details: Upgrade $200 Referral Bonus – Step By Step Directions.
Ally Bank ($100) – Of all the banks out there, Ally is, without a doubt, my favorite. At the moment, Ally is offering $100 to customers who open an eligible Ally account and meet the requirements. Here are the step-by-step directions to earn your Ally Bank referral bonus.
Fairwinds Credit Union ($175) – Fairwinds Credit Union is offering a referral bonus for users that sign up using a referral link. Fairwinds has no fees or minimum balance, so this is a particularly easy bonus to earn. Since this is a smaller credit union, my gut instinct tells me this offer won’t be around long, so if you’re in a position to meet the bonus requirements, grab this bonus before it’s gone. Here is my step-by-step guide on how to earn your Fairwinds Credit Union bonus.
Chime ($100) - Chime is a free bank account that offers a referral bonus if you use a referral link and complete a direct deposit of $200 or more. In practice, any ACH transfer into this account triggers the bonus. This bonus is easy to earn and posts instantly, so you’ll know if you met the requirements as soon as you move money into the account. I wrote a step-by-step guide on how to earn your Chime referral bonus that I recommend you check out.
US Bank Business ($900) – This is a fairly easy bank bonus to earn, since there are no direct deposit requirements. In addition, you can open the Silver Business Checking account, which comes with no monthly fees. Check out how to earn this big bonus here.
GO2Bank ($50) - GO2Bank is an easy bank bonus that I recommend people take advantage of if they have an easy way of meeting the direct deposit requirement. I like that it’s easy to open the account and that the bonus pays out quickly. Check out my step-by-step guide on how to earn your GO2Bank $50 referral bonus.
Current ($50) – Current is a free fintech bank that’s offering new users a $50 referral bonus after signing up for an account using a referral link. Current is an easy bonus to earn and also gives you access to three savings accounts that pay you 4% interest on up to $2,000. That means you can put away up to $6,000 earning 4% interest. That’s very good and makes Current an account I recommend to everyone. Check out my step-by-step guide on how to earn your Current Bank bonus.
Novo Bank ($40) - Novo bank is a free business checking account that’s currently offering a $40 bonus if you open a Novo business checking account using a referral link. In addition to being a good bank bonus, Novo is also a good business checking account. It has no monthly fees or minimum balance requirements and operates a good app and website. Indeed, it’s the business checking account I currently use for this blog. Check out my post on how to easily open a Novo account.
Varo ($25) – Varo is a free fintech banking app similar to Chime or Current. It’s currently offering a $25 bonus to new users that open a new Varo account with a referral link. The bonus for this bank is very easy to meet, all you need to do is spend $20 within 30 days of opening your Varo account. Check out my step-by-step guide to learn how to earn this bonus.

Kevin is an attorney and the blogger behind Financial Panther, a blog about personal finance, travel hacking, and side hustling using the gig economy. He paid off $87,000 worth of student loans in just 2.5 years by choosing not to live like a big shot lawyer.

Kevin is passionate about earning money using the gig economy and you can see all the ways he makes extra income every month in his side hustle reports.

Kevin is also big on using the latest fintech apps to improve his finances. Some of Kevin's favorite fintech apps include:

SoFi Money. A really good checking account with absolutely no fees. You'll get a $25 referral bonus if you open a SoFi Money account with a referral link, and an additional $300 if you complete a direct deposit.
5% Savings Accounts. I'm currently getting 5.24% interest on my savings through a company called Raisin. Opening a Raisin account takes minutes to complete, it's free, and all of your funds are FDIC-insured. I explain how it works, why I'm now using it to store my emergency fund and any other cash savings I have, and why I recommend everyone check it out in this review.
US Bank Business. US Bank is currently offering new business customers a $900 signup bonus after opening a new account and meeting certain requirements.
M1 Finance. This is a great robo-advisor that has no fees and allows you to create a customized portfolio based on your risk tolerance. You also get $100 for opening an account.
Empower. One of best free apps you can use to monitor your portfolio and track your net worth. This is one of the apps I use to track my financial accounts.

Feel free to send Kevin a message here.