Nebraska FHA Loan
Everyone wants to have a nice home for themselves or for their family. If you are planning to have a home in Nebraska then you need a mortgage and the best eligibility criterion is offered only through a Nebraska FHA loan. Now let's take a quick look at some of the census data accumulated from the year 2000. There were 722,668 housing units in Nebraska in 2000 as compared to 660,621 in 1990, which is an increase of 9.4%. Out of these there were 493,706 located in the urban area and 228,962 located in the rural area. The homeownership rate in Nebraska is about 67.4% as of today and the vacancy rate including seasonal lodging stands at about 7.8%. The average household size in Nebraska is 2.49 people and most of the houses, apartments and condos were built after 1965.
Nebraska FHA administers a number of programs, based on Section 203(b), that have special features. One of these programs, Section 251, insures adjustable rate mortgages (ARMs) which, particularly during periods when interest rates are high, enable borrowers to obtain mortgage financing that is more affordable by virtue of its lower initial interest rate. This interest rate is adjusted annually, based on market indices approved by FHA, and thus may increase or decrease over the term of the loan.
FHA in Nebraska administers a number of programs, based on Section 203(b), that have special features. One of these programs, Section 251, insures adjustable rate mortgages (ARMs) which, particularly during periods when interest rates are high, enable borrowers to obtain mortgage financing that is more affordable by virtue of its lower initial interest rate. This interest rate is adjusted annually, based on market indices approved by FHA, and thus may increase or decrease over the term of the loan.
Type of Assistance: This program provides insurance for adjustable-rate mortgages, used in conjunction with other widely used FHA single-family products - Mortgage Insurance for One to Four Family Homes, Single-Family Rehabilitation Mortgage Insurance under Section 203(k), and Single-Family Mortgage Insurance for Condominium Units under Section 234(c).
Under this Nebraska FHA insured mortgage plan, the interest rate and monthly payment are initially low, but they change during the life of the loan. FHA Nebraska uses 1 year Treasury Constant Maturities Index to determine the changes in the interest rate. The maximum amount of interest rate that can increase or decrease during any one year is 1 percentage point. The maximum interest rate change over the life of the loan is 5 percentage points from the initial rate. Mortgage Lenders in Nebraska should always disclose the terms of the ARM to the borrower at the time of loan application. In addition to this borrowers need to be informed at least 25 days in advance of any adjustment to their monthly payment. Section 251 loans are similar to basic FHA-insured single-family loans and they are:
- The down payment requirements can be low-as little as 3 percent. Nebraska FHA insurance allows new home borrowers to finance approximately 97% of the value of their home purchase through their mortgage.
- The FHA closing costs can also be financed. Under this program, borrowers are allowed to finance these charges, which reduces the up front cost of buying a home. Apart from the down payment, the borrower needs to pay for the appraisal and the title search. Nebraska FHA mortgage insurance is not free and borrowers are required to pay an up-front insurance premium.
- Some of the FHA fees are limited. FHA Nebraska has some rules that impose limits on certain fees, which the Mortgage lenders of Nebraska can charge while creating a loan. The loan origination amount that is charged by the Nebraska lender as an administrative cost of processing the loan will not exceed one point, which is 1% of the amount of the mortgage. Apart from this the property appraisal and inspection fees are also set by Nebraska FHA.
- HUD in Nebraska can set limits on the amount that needs to be insured. HUD makes sure that its programs are able to assist low and moderate income home buyers. Nebraska FHA sets a limit on the dollar value of the Nebraska FHA mortgage loan.