Are you ready to buy a home in Nebraska? You probably have a lot of questions — from finding the right house to choosing the best mortgage lender. Before you dive in, make sure you understand how mortgage rates are determined so you can find the lender that best suits your financial needs.
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Quick Look: Best Mortgage Lenders in Nebraska
- Quicken Loans: Best Overall
- Chase: Best for in-person Applicants
- New American Funding: Best for Alternative Credit
- Better.com: Best for Online Applications
- Gateway Mortgage Group: Best for Mortgage Options
- Veterans United: Best for Military Families
- What is a Mortgage Rate?
- What Factors Impact Your Mortgage Rate?
- What is a Mortgage Type?
- What is a Mortgage Term?
- Current Mortgage Rates in Nebraska
- Calculating Interest in Nebraska
- Lender Credit Score Minimums in Nebraska
- 5 Best Mortgage Lenders in Nebraska
- Buy Your Dream Home in Nebraska
- Frequently Asked Questions
What is a Mortgage Rate?
Before you can choose the right mortgage lender, you’ll need to understand mortgage rates. Your mortgage rate is the rate of interest you’ll pay on your loan. Let’s say your mortgage is for $200,000. You’ll be responsible for paying back the full amount, plus interest.
In general, the lower your mortgage rate, the more money you’ll save in interest over the duration of your loan. You’ll need to know what factors are used to determine your rate to get the lowest rate possible.
What Factors Impact Your Mortgage Rate?
You can pull up general mortgage rates for specific lenders or regions and there are a variety of different factors that will determine your individual mortgage rate. Find out more about how to improve your odds of locking in a low rate below.
Most people know their credit score is important when applying for a home, but few know why. Your credit score will have a huge impact on how high or low your mortgage rate is. Generally, the higher your score, the lower your rate.
Loan-to-Value (LTV) Ratio
LTV ratio is another important factor lenders consider when setting your mortgage rate. LTV refers to how much you’re borrowing compared to the value of your home.
You can figure out your LTV by dividing the amount you’re financing by your home’s value. Let’s say you’re putting $20,000 down on a $200,000 home and you borrow the remaining $180,000. Your LTV would be $180,000 divided by $200,000. This gives you an LTV of 0.9, or 90%. Your loan could be considered riskier and set at a higher interest rate if your LTV is high. You’ll want to shoot for an LTV of 80% or lower.
Every mortgage lender has its own policies for determining mortgage rates. That’s why it’s a good idea to apply with a few different lenders to compare the various rates you’re offered.
Where you’re buying your home could impact your mortgage rate. Housing markets fluctuate, so the time of year and the health of the local market can cause rates to move. Rates tend to be lower in a healthy economy and market. When the market is weak, rates tend to rise. Gauge the market to determine what type of mortgage rate you could get.
Mortgage Type and Term
The other factors that can impact your mortgage rate include the mortgage type and term. Different mortgage products tend to have different rates — some rates are even managed on a federal level. The length of time of your mortgage, or term, can also affect your rate.
Find out more about how mortgage types can impact your rate below.
What is a Mortgage Type?
There are several types of mortgages you can pick from when you buy a home in Nebraska. Four of the most common mortgage types include conventional, FHA, USDA and VA mortgages.
Conventional mortgages are financed by banks or credit unions, rather than the government. These mortgages often have slightly higher interest rates, since they’re not backed by the federal government.
FHA loans, also known as first-time homebuyer mortgages, are secured through the Federal Housing Administration. They have lower interest rates since they’re backed by the government because the risk to the lender is lower with an FHA loan. Many lenders offer FHA loans, including banks who also offer conventional mortgages.
FHA mortgages offer incentives such as 3% down payment options and a low credit score requirement of 580. Let’s say you do pay under 20% for your down payment — you’ll need to purchase private mortgage insurance (PMI), which protects your lender if you default on your loan.
USDA mortgages are financed by the United States Department of Agriculture and can be used if you’re purchasing a home in a rural area. Most homes in the country outside of cities are considered to be in rural areas, but you can see if your address qualifies on the USDA website.
You can enjoy low or no down payment options, low mortgage rates and flexible credit eligibility. You’ll need mortgage insurance if your down payment is less than 20%. USDA mortgages are well-known for their low mortgage insurance rates.
VA loans make it easy for current or former members of the military to receive funding for housing. VA loans are financed through the Department of Veterans Affairs and offer a variety of incentives to eligible members.
You’ll benefit from a no down payment requirement, no mortgage insurance requirement, flexible credit eligibility and low mortgage rates. Be prepared to pay an origination fee of around 1% to cover the loan processing charges — but you can also roll this cost into your loan.
What is a Mortgage Term?
Your mortgage term, or the length of time of your mortgage, will play a key role in determining your rate. We’ll review the 3 most common mortgage terms to help you understand how the term you choose could impact your rate.
The 30-year fixed-rate mortgage is the standard mortgage on the market. You’ll pay a set interest rate for the duration of 30 years for this mortgage term. You can expect to pay lower monthly payments, but will often pay more interest over time. These mortgages have higher interest rates even though they’re more affordable month-to-month.
The 15-year fixed-rate mortgage is the second type of fixed-rate mortgage you can purchase. Like its 30-year counterpart, you’ll pay a set interest rate for 15 years. Expect to pay more per month, since your loan term is 50% shorter. You’ll actually pay less in interest and often have a lower interest rate.
5/1 Adjustable Rate
The 5/1 adjustable-rate mortgage is a loan that does not have a fixed rate. Adjustable-rate mortgages (ARMs) have rates that change over time. The 5/1 ARM guarantees you’ll pay the same rate for 5 years, before the rate changes. You might be able to lock in a low introductory rate with a 5/1 ARM — which will benefit you if you want to sell your home in a short amount of time.
Current Mortgage Rates in Nebraska
Looking at current mortgage rates in Nebraska will help you prepare for what to expect when financing your home. It’s important to note that rates change as the market fluctuates, but Benzinga strives to provide you with the most up-to-date rates.
|Loan Type||Current Mortgage Rate|
|5/1 ARM (adjustable rate)||4.03%|
Calculating Interest in Nebraska
The total interest on mortgages in Nebraska is calculated by looking at average home values, loan terms and the average mortgage rate. We calculated these numbers to show you how much interest you can expect to pay for a typical home in the Sooner State.
|City||Average Home Value||Loan Term||Current Rate||Monthly Payment||Total Interest Paid|
|Grand Island||$160,800||30-year fixed||3.75%||$744.69||$107,288.35|
Lender Credit Score Minimums in Nebraska
Knowing your credit score will help you decide what lenders are most likely to approve you for a mortgage. Here’s a list of some of the top mortgage lenders in Nebraska and their minimum credit scores.
|Lender||Minimum Credit Score Required|
|JP Morgan Chase||620|
|PNC Financial Services||700|
5 Best Mortgage Lenders in Nebraska
It’s time to take a look at some of the top lenders in Nebraska. We’ve reviewed the most popular choices in the state and compiled a list of the top 5 mortgage providers that you should look into.
1. Best Overall: Quicken Loans
Quicken Loans makes applying for a mortgage in Nebraska easy and fast, with its fully online mortgage application process and streamlined income verification procedure.
You’ll also be assigned to a loan officer who will be there to guide you through the process if you have any questions.
Quicken Loans’ minimum credit score requirement is 620, and the company offers conventional, FHA, VA and USDA loans.
2. Best for In-Person Applications: Chase Mortgage
You should consider Chase Bank if you want to walk into a bank and receive full guidance through the mortgage process.
Not only does Chase offer a large number of mortgage products, it also offers discounts to existing bank customers.
Chase Mortgage has a minimum credit score requirement of 620 and offers conventional, FHA, VA and USDA loans.
3. Best for Alternative Credit: New American Funding
New American Funding offers a streamlined online application process that allows for alternative credit consideration.
It has a manual underwriting process that can be helpful if you’re working to build or rebuild your credit.
New American Funding has a minimum credit score requirement of 620 (including alternative credit) and offers conventional, FHA, VA and USDA loans.
4. Best for Online Applications: Better.com
Better.com offers an intuitive and fast online application process with no origination fees.
You can find out your pre-approval status in as little as 24 hours, which makes it a great option if you need funding quickly.
Better.com has a minimum credit score requirement of 620 and offers conventional and FHA loans.
5. Best for Mortgage Options: Gateway Mortgage Group
Gateway Mortgage Group is a national private mortgage lender with a small-town feel.
Gateway strives to focus on local communities and offers mortgage products that best fit your area’s needs.
Gateway Mortgage Group has a minimum credit score requirement of 620 and offers conventional, FHA, USDA and VA loans.
6. Veterans United: Best for Military Veterans
If you’ve logged some time in the military, Veterans United’s loans will likely be the best deal. Unlike other veteran-marketed loan programs, Veterans United only accepts active duty and veteran military members.
In addition to no-down-payment loans, you’ll also eliminate the private mortgage insurance you’ll have to pay with other mortgages.
Veterans United is also more forgiving of lower credit scores. Interest rates are lower than average.
Buy Your Dream Home in Nebraska
Purchasing a home in Nebraska is a huge decision — and many small decisions show up along the way. Know how to reduce your mortgage rate and interest so you can secure your financial future. Be sure to compare rates and incentives to find the best mortgage for your budget.
Frequently Asked Questions
1) Q: How do I get pre-approved?
First, you need to fill out an application and submit it to the lender of your choice. For the application you need 2 previous years of tax returns including your W-2’s, your pay stub for past month, 2 months worth of bank statements and the lender will run your credit report. Once the application is submitted and processed it takes anywhere from 2-7 days to be approved or denied. Check out our top lenders and lock in your rate today!
2) Q: How much interest will I pay?
Interest that you will pay is based on the interest rate that you received at the time of loan origination, how much you borrowed and the term of the loan. If you borrow $208,800 at 3.62% then over the course of a 30-year loan you will pay $133,793.14 in interest, assuming you make the monthly payment of $951.65. For a purchase mortgage rate get a quote here. If you are looking to refinance you can get started quickly here.
3) Q: How much should I save for a down payment?
Most lenders will recommend that you save at least 20% of the cost of the home for a down payment. It is wise to save at least 20% because the more you put down, the lower your monthly payment will be and ultimately you will save on interest costs as well. In the event that you are unable to save 20% there are several home buyer programs and assistance, especially for first-time buyers. Check out the lenders that specialize in making the home buying experience a breeze.