Guides / Home projects
Home improvement loans in Texas
Short answer: Texas caps all debt secured by your home at 80% of its value, so many homeowners can't borrow more against their equity. A personal loan doesn't use your home as collateral, so the 80% limit doesn't apply. Texas veterans may also qualify for the Veterans Land Board home improvement program, with loans up to $50,000.
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How the Texas 80% rule affects home equity loans
Under Article XVI, Section 50(a)(6) of the Texas Constitution, your existing mortgage plus any home equity loan can't exceed 80% of your home's fair market value. On a $300,000 home with $200,000 owed, the most you could borrow against it is $40,000. Fees on these loans are capped at 2%, and you can take only one every 12 months.
Personal loan vs. home equity in Texas
| Personal loan | Texas home equity loan | |
|---|---|---|
| Uses your home as collateral | No | Yes |
| 80% loan-to-value limit | Doesn't apply | Applies to all home debt |
| Waiting period | None | 12-day notice before closing |
| Time to fund | Often 1 to 5 business days after approval | Usually several weeks |
| Typical rates | Higher | Lower |
Texas veterans: the VLB home improvement program
The Texas Veterans Land Board offers home improvement loans up to $50,000 for eligible Texas veterans and some surviving spouses, with terms of 2 to 20 years. Loans over $25,000 must be a first lien on the home. Rates change often; check the >Texas GLO program page for current terms.
Lenders in our network that serve Texas
Regional Finance and OneMain have Texas branches. Availability and loan limits vary by lender.
Checking your rate uses a soft credit pull. Accepting an offer and finishing a lender's application may lead to a hard inquiry.
Texas home improvement loan questions
Does the Texas 80% rule apply to personal loans?
No. It applies only to loans secured by your homestead. An unsecured personal loan isn't.
Can I get a home improvement loan in Texas with bad credit?
Some lenders in our network work with fair credit, and branch lenders in Texas make secured loans. Rates will be higher.
Who qualifies for the VLB home improvement loan?
Texas residents who meet the program's military service rules, for a primary residence in Texas. See the Texas GLO page for full eligibility.
Sources: >Texas A&M Real Estate Research Center, >Texas GLO.