Nebraska Mortgage Rates

Nebraska is not one of the most popular states to live in, but there are several advantages to living there. The state has affordable prices on real estate, good interest rates and many vacant properties. Job prospects are better than average and the overall cost of living is below the national average.

Real Estate Prices

Nebraska’s median home value is about $100,000 and has been hovering at that range for several months. Compared to national averages, this is much lower than the report of $177,000. As most who are familiar with U.S geography already know, most of the cities in Nebraska are fairly small. While these cities’ home values are much lower on average, even the state’s largest city, Omaha, has lower values than the national average. Recent home value reports showed an average of $144,900 for Omaha, with nearly 6,000 properties for sale. This average dropped from $146,000 the month before. According to real time pricing data, the values and prices of Nebraska homes have steadily fallen since the beginning of the year. Current and recent rates average between 4.6% and 4.9%, depending on the type of loan.

Best Places To Live In Nebraska

Nebraska’s state slogan, as seen on the signs that mark the state borders, is “The Good Life.” Residents of the state enjoy a lower average on grocery prices and utility fees than most of the nation. Thanks to being located in the heart of U.S agriculture, beef, pork, chicken and grains are readily available and comprise the majority of the state’s income. Most of the state’s population is found in the central/southern and southeastern part of the state. In the eastern part of the state is an area called the Sandhills. True to its name, the area consists mostly of sand and is not optimal for growing crops, resulting in a low regional population. Some of the most popular areas to live are small cities and the two largest cities in the state. Just as in any other state, Nebraska does have its downfalls. Icy and snowy winters, poor winter road conditions and lack of road construction in some cities are a few disadvantages. Following is a breakdown of each city and what makes it attractive for relocation.

Omaha

Omaha is the 40th largest city in the U.S and is divided from Council Bluffs, Iowa by the Missouri River. Omaha’s population is 454,731. Located in the southeastern part of the state, Omaha’s benefits include:

  • Wages are higher than the average wages in most parts of the country.
  • The cost of living is lower than the national average for cities of similar size.
  • A wide range of jobs are available, including optimal amounts of professional, trade, healthcare, factory and agricultural jobs.
  • The ratio of open jobs to job-seekers is lower than the national average.
  • Roads are cleared quickly in the winter and Interstate 80, the main freeway, is well-maintained all year round.
  • Plenty of recreation and entertainment options are available.
  • Schools and colleges are plenty in number and rated higher than average.

Lincoln

Lincoln is the capital of Nebraska and is the home of the Cornhuskers, the University of Nebraska’s famous home team. It is well-known for being attractive to musicians, artists and trendy businesses. It is also the most popular shopping hub in the state, with residents traveling from all over Nebraska, Iowa and Kansas to shop there. Some of the features that make it attractive for relocation are:

  • There is opportunity for small businesses to flourish.
  • Artists and musicians have an easier time finding work in this city.
  • There are plenty of parks and recreation in the area.
  • Medical occupations are large in number and the need for workers is always present, making it easy for medical personnel to find work.
  • Wages are commensurate with the cost of living.
  • Real estate prices are affordable for all budgets.

Grand Island

Grand Island is home to the Nebraska Law Enforcement Training Academy, Central Community College and an extension of Doane College. The Platte River forks around the town, once the site of many tragic incidents of quicksand-sunken wagons during pioneer days. Many people who relocate from out-of-state choose Grand Island for several reasons, including:

  • Low real estate prices
  • Good-paying industrial work, including beef plants, product manufacturing plants and beverage plants. Most of the city’s population either works in one of the many retail stores or in one of the many industrial plants.
  • Numerous highly-rated schools.
  • It is a thriving and diverse cultural community for Latinos.
  • There are plenty of healthcare jobs and the demand for personnel is high.

Types Of Mortgages Available

Depending on the type of property being bought, along with the buyer’s credit and circumstances, there type of mortgage selected will vary. The majority of mortgages obtained in Nebraska are either fixed or variable rate mortgages. There are also several other choices that will be discussed in further detail.

Fixed Rate Mortgages

Nearly every buyer seeks to obtain a fixed rate mortgage in Nebraska. The state has a low cost of living, but since the national interest rate averages fluctuate so much, home buyers feel safest having a loan on which they can count on paying the same rate each month. Following are the defining features of Nebraska fixed rate mortgages.

  • They usually span a length of 15 to 30 years.
  • The interest rate never changes; it remains the same as the rate offered on the contract when signing.
  • At the time of offering, the rate of a fixed mortgage is slightly higher than the initial adjustable rate mortgage offer.
  • The most stable kind of mortgage available.

Adjustable Rate Mortgage

With the fluctuations in interest rates changing, but still remaining low, many buyers are choosing adjustable rate mortgages. There are several key features to understand about this type of mortgage.

  • Their rate changes whenever national interest rate averages change.
  • Rates can range between extremely low and extremely high; they are unpredictable.
  • The initial interest rate offered on this type of mortgage is lower than most other options.
  • Monthly payments vary; sometimes they may be lower than the initial payment or higher.
  • They tend to be advantageous for home buyers who have a shorter loan term, such as 1-year or 3-year.
  • The entire term of these loans is much shorter than fixed rate loans, meaning that less money is paid total toward interest.

Jumbo And Balloon Mortgages

These types of mortgages are much less popular than fixed rate or variable rate choices. Most lenders are hesitant to offer these in Nebraska, especially with so many home buyers still facing financial strains as the economy continues to slowly recover in the following years. The features that make up balloon and jumbo mortgages follow.

  • They have a specific length of time until maturity, or the end of the loan.
  • When the loan matures, a final payment of the remaining balance called a “balloon” payment must be made, which is substantially higher than monthly payments.
  • Monthly payments during the specified time period are usually made using a 30-year fixed amortization rate.
  • Many buyers are unable to make such a high payment at the end of the loan, so they may be offered a two-step program, which allows the remainder of the amount to be financed if they had no prior late payments during the loan.
  • Better for people who have a comfortably flexible budget, stable income and definitely will not move during the loan’s course.

Non-Recourse Loans

Non-recourse loans are what every buyer in the country would prefer. Their opponent, the Recourse Loan, will result in them losing their personal assets if they default and the property value is insufficient to cover the loan obligation. Although many states do not offer non-recourse loans, Nebraska is one of the states that does. Before entering a loan contract that is non-recourse, it is important to understand what is included.

  • The lender has the power to seize the buyer’s collateral to pay off the balance in the case of default.
  • Collateral is decided at the time the loan is signed; it is an agreement between the lender and buyer.
  • The lender can not seize any of the buyer’s personal assets or property that is not named as collateral.
  • If the amount of the property value at default and the collateral are insufficient to cover the cost of the loan, the lender takes a loss and the buyer is not obligated to compensate further.
  • Loan to value ratios are usually set between 50% and 60% usually.
  • Monthly interest rates are higher than recourse loans.
  • Non-recourse loans are overall considered buyer-friendly and are a risk for the lender.

Nebraska State Property Deeds

Deeds for this state are available for corporations, individuals, and limited liability companies. Most deeds are either Quitclaim, Grant or Warranty deeds. To hold title of the land, the buyer must have one of these documents signed at the closing. The difference between each of the deeds are based on the circumstances of the buyer and what type of property they are purchasing, such as residential or commercial. All of these deeds are used uniformly throughout the state. Each document requires the signature of a notary public and at least two legal witnesses.

Additional Mortgage Assistance Programs

Nebraska is a state that welcomes more residents to its population every year. To encourage further growth in numbers, there are plenty of additional programs that are helpful to both first-time home buyers and those who have previously owned real estate. To give one example, home buyers who choose to purchase a residential property in certain parts of Fillmore County will qualify for a $10,000 grant toward a down payment. This program is awarded by the county and is free, as long as buyers fit the criteria and remain in the same home for at least 10 years. Many other smaller towns and certain areas of cities have these offers, usually designed to help redevelop areas that are not as heavily populated. Special FHA loans and NIFA first-time home buyer loans are also available in the state to qualified buyers.

Foreclosure In Nebraska

In Nebraska, the foreclosure process begins when a petition is filed in court by the lender. After this, the information is made public in local newspapers. Non-judicial foreclosure will depend on the deed’s specified timing, which varies from one buyer to the next. Following are the key points of the foreclosure procedure in Nebraska.

  • Judicial proceedings are prevalent and are filed by the lender, then publicized.
  • The processing of foreclosure documents may take up to 142 days.
  • There is no right of redemption
  • The buyer is allowed to reinstate the loan.
  • Deficiencies are only possible as continuances, but not during the pending incomplete foreclosure action.
  • If a payment is missed on a reinstated loan, the lender may continue the foreclosure process.

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