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VA Cash Out Refinance in Texas

Types of VA Cash-Out Home Loan Scenarios 

  • Scenario: VA loan to VA loan: You currently have a VA loan and want to refinance into another VA loan to receive cash from your equity. Answer: Unfortunately, in the state of Texas, you cannot refinance into a VA loan and receive cash from your equity due to the TX50(a)(6) law. You can do a VA renovation refinance loan but the cash received is strictly to make home improvements.
  •  Scenario: VA loan to Conventional loan: You currently have a VA loan and you want to refinance and take cash out. You can do this on a conventional loan in the state of Texas. Answer: We can help you on this loan program and give you estimates. You will need to maintain a loan to value of 80% on your new mortgage loan. 
  • Scenario: Conventional to VA: You currently have a conventional loan that you had taken cash out on in the past and want to refinance into a VA loan. Answer: You can do this as long as 12 months have past since you took cash out on your conventional loan. In this case you can finance up to 100% loan to value.  
  • Scenario: You would like to do home improvements on your current home but do not want to mess with your current interest rate since it’s very low. Answer: Conventional to VA: You currently have a conventional loan that you had taken cash out on in the past and want to refinance into a VA loan. You can do this as long as 12 months have past since you took cash out on your conventional loan. In this case you can finance up to 100% loan to value.. 

In the state of Texas, there is not a way to do a VA Cash-Out refinance. However we can help you with a VA renovation refinance loan (to make home improvements) or we can assist you with obtaining a Home Equity Line of Credit. 

Texas 50(a)(6) Law and Its Implications:

  • No Cash-Out: Under the Texas 50(a)(6) law, veterans in Texas are not allowed to receive cash-back from a VA Cash-Out refinance. The primary purpose of this legislation is to protect homeowners by restricting the amount and conditions under which they can borrow against their home equity.
  • Refinancing Loans: While Texas veterans cannot take cash out, they are permitted to refinance their existing mortgage into a VA loan. This is beneficial if you currently have a Conventional, FHA, or USDA loan and are looking to benefit from the typically lower rates, remove private mortgage insurance and better terms provided by VA loans. If you have had a Conventional Cash Out within 12 months, you would need to wait 12 months from your closing date to refinance into a VA loan.
  • Debt Consolidation: Unfortunately you are not able to use a VA home loan to consolidate debt in Texas. You can however apply for a home equity line of credit that will allow you to consolidate debt. 
  • Energy-Efficient Improvements: Texas veterans are still able to finance energy-efficient improvements to their home through a VA refinance, as long as the funds are paid directly to the supplier or contractor performing the improvements.

Navigating the VA Cash-Out Refinance in Texas: 

Understanding and navigating the complexities of the VA Cash-Out refinance in Texas can be challenging due to the restrictions imposed by the Texas 50(a)(6) law and the Texas 50(f)(2) law. This is where we can be of assistance: 

  • Expert Guidance: We can help explain the nuances of Texas laws regarding VA loans and how they impact your refinancing options. 
  • Loan Comparison: We can provide a detailed comparison of your current mortgage terms versus the potential terms of a VA refinance vs a Conventional Cash Out refinance, and see if you could benefit from better loan terms. 
  • Application Assistance: We can guide you through the application process, ensuring you have all the necessary documentation and understanding each step along the way. 
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CrossCountry Mortgage, LLC is not affiliated with or acting on behalf of or at the direction of the Veteran Affairs Office or any government agency. Certificate of Eligibility required for VA loan in Texas. NMLS License #3029 | MB.803095 | NMLS Consumer Access | CFPB

Shirley Mueller

Sr. VP of Veteran Lending Specializing in Texas Vet & VA Loans NMLS ID: 336103

6601 Vaught Ranch Rd, Suite 101 I, Austin, TX 78730

888-788-4977

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**The advertised rates and points listed are subject to change at any time without prior notice and may not be available to all borrowers. These rates are predicated on specific assumptions and lending scenarios. The actual rate available to you can vary depending on your personal details, such as your credit score, the amount of the loan, your down payment, and our internal lending criteria. The rates provided are for a fixed rate mortgage, but they will differ depending on the loan term and property location. Additional rates, points, and loan terms might be available. Approval of all loans is contingent on credit and property evaluations. Property insurance is mandatory, and flood insurance might also be necessary.

Interest rates for the Texas Vet program are set weekly by the Texas Veterans Land Board and are subject to change based on when you lock your interest rate. Annual Percentage Rate (APR) represents the true yearly cost of your loan, including any fees or costs in addition to the actual interest you pay to the lender. Click HERE for an example.

Applicant subject to credit and underwriting approval. Not all applicants will be approved for financing. Receipt of application does not represent an approval for financing or interest rate guarantee. Restrictions may apply, contact  CrossCountry Mortgage for current rates and for more information.

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