VA assumable loans in Texas: how they work for buyers and sellers
Many San Antonio homes still have VA loans at 2% to 3% interest. An assumption lets a buyer take over that rate. Here's who qualifies, what it costs, how to protect the seller, and which Texas forms to use.
By Kassie Johnson, REALTOR®, MRP · The GoldenEye Group at Barlowe Daly Realty · Updated October 20, 2026
The short answer
When you assume a VA loan, you take over the seller's existing loan: the same interest rate, remaining balance and remaining term. You don't need to be a veteran, but you do need approval from the seller's loan servicer. You pay a 0.5% VA funding fee in cash at closing and cover the difference between the price and the loan balance with cash or a second loan. Sellers should get a release of liability. They only get their VA entitlement back if the buyer is a veteran who substitutes their own.
- Who can assume
- Anyone who qualifies with the servicer
- VA funding fee
- 0.5% of the balance, paid at closing
- Servicer fees in Texas
- Up to $300 + $404 regional fee
- Typical timeline
- About 45 to 90 days
How a VA loan assumption works
The buyer applies with the seller's current servicer, not a new lender. That's the biggest difference from a normal purchase.
1. Confirm the loan
Confirm it's a VA loan, that payments are current and what the balance is. A loan with missed payments can't be assumed. VA loans made after March 1, 1988 need servicer or VA approval.
2. Write the contract
Use the TREC purchase contract with the Loan Assumption Addendum (TREC No. 41-3). Add TREC No. 12-3 if the seller wants a release of liability or their VA entitlement back.
3. Buyer applies
The buyer applies with the servicer on VA Form 26-6381 and provides the same income, credit and asset documents as a regular loan.
4. Line up the gap
At the same time, the buyer gets cash ready or approval for a second loan to cover the equity gap. This is the step most likely to cause delays.
5. Approval
The servicer reviews the buyer's finances. Some files also go to VA for approval. Expect follow-up requests for documents.
6. Closing
The buyer pays the gap, the funding fee and closing costs. The seller's release of liability, and any substitution of entitlement, are processed with the assumption.
What a VA assumption costs in Texas
Assumptions usually cost much less than a new loan, but the buyer needs more cash, because the equity gap is often large.
| Cost | Amount | Notes |
|---|---|---|
| VA funding fee | 0.5% of the loan balance | Paid in cash at closing and can't be added to the loan. Veterans who receive VA disability pay, and some surviving spouses, are exempt. |
| Servicer processing fee | Up to $300 | Set by VA. Covers underwriting, processing and closing the assumption. |
| Regional fee | $404 in Texas | VA allows servicers to add this regional fee only if the assumption closes. |
| Equity gap | Sale price minus loan balance | Paid with cash or a second loan that sits behind the VA loan. |
| Other closing costs | Varies | Credit report, title work and title insurance, recording fees, property taxes and insurance. |
Example: a San Antonio home
| Item | Amount |
|---|---|
| Sale price | $325,000 |
| VA loan balance being assumed (2.75% rate) | $240,000 |
| Equity gap (cash or second loan) | $85,000 |
| VA funding fee (0.5% × $240,000) | $1,200 |
| Servicer fees (maximum) | About $704 |
Illustration only. Title, escrow and other closing costs are extra. A second loan for the gap usually has a higher, current-market rate, so compare the combined payment with a new loan before you decide.
Release of liability vs. getting your VA entitlement back
These are two separate protections. Getting one doesn't give you the other.
| Release of liability | Substitution of entitlement | |
|---|---|---|
| What it does | You're no longer responsible if the buyer stops paying. | The buyer's VA entitlement replaces yours, so you can use your VA benefit again. |
| Who the buyer can be | Veteran or non-veteran who qualifies with the servicer | Only an eligible veteran with enough entitlement who will live in the home |
| How it's done | Requested with the assumption on VA Form 26-6381 | Buyer completes VA Form 26-8106 with the assumption |
| Texas form | TREC No. 12-3, Part A | TREC No. 12-3, Part B |
Moving to a new base?
If a non-veteran assumes your loan, part of your VA benefit stays tied to this house. You may still have enough left to buy at your next duty station. Ask a VA lender to run the numbers before you accept an offer.
Make it a condition of closing
In TREC No. 12-3 you choose whether the deal can end if the release isn't approved by closing, or whether closing goes ahead anyway. Choose carefully.
Market it
A low assumable rate is a strong selling point. I highlight it in the listing and screen buyers' cash and financing for the gap up front.
Not sure your loan is VA?
Check your monthly mortgage statement or your closing papers, or ask your servicer. I'm happy to help you find out before you list.
Texas forms and local tips
TREC No. 41-3
The Loan Assumption Addendum covers the loan details, the buyer's approval and fee limits. It also warns sellers that they stay liable unless the lender releases them, and allows a vendor's lien and deed of trust to secure the assumption if the seller isn't released.
TREC No. 12-3
The Addendum for Release of Liability on Assumed Loan and/or Restoration of Seller's VA Entitlement. Veteran sellers should usually complete both parts.
Escrow balance
The seller's escrow account for property taxes and insurance usually transfers with the loan. Texas property taxes are high, so put in the contract whether the buyer pays the seller back for it.
Plan for the gap early
Only some lenders make second loans behind an assumed VA loan. Get approved for the gap before you write the offer.
Build in time
Servicers often take longer than a regular lender. Set a realistic closing date and stay in touch with the servicer's assumption team every week.
Get fees in writing
Ask the servicer for an itemized list of fees and their timeline in writing before you sign.
An MRP REALTOR® who knows VA assumptions
Assumptions involve more steps than a regular sale. I'll walk buyers and sellers through each one, from the contract to the servicer's approval.
- Military Relocation Professional. I'm NAR MRP certified and work with JBSA families every week, on both PCS buys and PCS sales.
- Sellers: I'll show how your low rate affects your price, use the right TREC forms and protect your release of liability and VA entitlement.
- Buyers: I'll help you find homes with assumable VA loans and connect you with lenders for the equity gap. You're always free to choose your own lender.
- Clear timelines. I keep in touch with the servicer and set realistic dates, so the deal doesn't stall.
VA assumable loan questions
Can a non-veteran assume a VA loan in Texas?
Yes. Anyone who meets the loan servicer's credit and income standards can assume a VA loan. If the buyer is not a veteran, the seller's VA entitlement stays tied to the loan until it is paid off.
How much does it cost to assume a VA loan?
The buyer pays a VA funding fee of 0.5% of the loan balance in cash at closing, unless exempt. The servicer can charge a processing fee of up to $300, plus a $404 regional fee for Texas properties when the assumption closes, along with normal title and closing costs.
What is the equity gap?
It is the difference between the sale price and the remaining loan balance. The buyer covers it with cash or a second loan that sits behind the VA loan. On a $325,000 home with a $240,000 balance, the gap is $85,000.
Does the seller get their VA entitlement back?
Only if the buyer is an eligible veteran with enough entitlement who will live in the home and completes a substitution of entitlement on VA Form 26-8106. Otherwise the seller's entitlement stays tied to the loan until it is paid off.
Is the seller released from the loan?
Not automatically. The seller should request a release of liability as part of the assumption. Once the servicer approves the assumption with a release, the seller is no longer responsible if the buyer stops paying.
How long does a VA loan assumption take?
Plan on roughly 45 to 90 days. Servicers are expected to move assumptions quickly, but timelines vary, so build extra time into the contract.
Which Texas contract forms are used?
Texas agents use the TREC Loan Assumption Addendum (TREC No. 41-3) with the purchase contract. If the seller wants a release of liability or restored VA entitlement, add the TREC Addendum for Release of Liability on Assumed Loan and/or Restoration of Seller's VA Entitlement (TREC No. 12-3).
Can any VA loan be assumed?
VA loans are assumable, and loans made after March 1, 1988 need approval from the servicer or VA. The loan must be current, with no missed payments, at the time of the assumption.
More for military buyers and sellers
Sources: VA Circular 26-23-10, assumption updates · VA Circular 26-23-10 Change 1, assumption fees · VA Circular 26-24-5, assumption locality variance (Exhibit A regional amounts) · VA Loan Guaranty assumptions training · TREC contracts and addenda · TREC No. 12-3. This is general information, not legal or lending advice. Fees and rules can change; confirm with the loan servicer and a licensed loan officer.