If you are home shopping in the Cornhusker state, then you probably have Nebraska mortgage rates on your mind. There are many different factors that go into calculating a mortgage rate. Credit standing is one consideration. The rates may vary by city and bank, as well. For example, the current rate in the urban city of Omaha may differ from what you’ll get from a bank in the small, rural town of Elmwood, Nebraska.
They type of loan you apply for matters, as well. The rate on a 30-year fixed loan is not the same as the interest on a 15-year fixed mortgage. Some homeowners might get assistance when buying their property, too, and that affects the interest rate. The average current interest rate for the state is a good place to start when deciding if you can afford to buy a home in Nebraska.
The Current Rates at a Glance
The rates will vary by product and lender.
30-year Fixed New Purchase:
- National average = 3.85%
- Nebraska average = 3.68%
- Nebraska Interest range = 3.62% APR – 3.94% APR
20-year Fixed New Purchase:
- National average = NA
- Nebraska average = 3.55%
- Nebraska Interest range = 3.51% APR – 3.68% APR
15-year Fixed New Purchase:
- National average = 3.83%
- Nebraska average = 3.65%
- Nebraska Interest range = 3.62% APR – 4.04% APR
10-year Fixed New Purchase:
- National average = NA
- Nebraska average = 2.90%
- Nebraska Interest range = 2.92% APR – 3.01% APR
5/1 ARM New Purchase:
- National average = 3.28%
- Nebraska average = 3.19%
- Nebraska Interest range = 3.22% APR – 3.40% APR
The rates change if you use an assistance program such as FHA or VA.
30-year FHA New Purchase:
- Nebraska average = 3.44%
30-year VA New Purchase:
- Nebraska average = 3.65%
All rates are based on zero points and good credit. The numbers will fluctuate based on your situation.
A Look at the Current Interest Trends
In 2015, housing market experts at Kiplinger predicted that mortgage rates would hover around 4 percent for the nation. This was based on the fact that the 30-year fixed interest rate had remained below 5 percent for five consecutive years. That prediction was a little high. In August, the national average for 30-year fixed loans was closer to 3.87. Going into 2016, the interest rate is dropping for the country. As of February, the national average for 30-year fixed loans is down to 3.5.
The state of Nebraska is showing similar results, but the interest rate over the last six months has been anything but stable. In August of 2015, it as at around 3.8 percent, but in November, it jumped to 4.2. As of February, the state average is at 3.63.
The 15-year fixed loan rates are a little lower. That national average for August of 2015 was a little over 3.2 percent. In November, that number dropped to 2.85 and for February 2016, it is back up to 3.03. Nebraska home buyers faired a little better. The rate in August was 2.90 and for February 2016, it has dropped to 2.85.
Nebraska Mortgage Rate Predictions for 2016
With a new year comes a new set of predictions. Experts predict mortgage rates will be erratic in 2016, but go up considerably. The Mortgage Bankers Association and Fannie Mae expect the average rate for a 30-year fixed loan to hit 5.1 by the end of the year, but the interest will fluctuate by quarter.
- Q1: 4.4%
- Q2: 4.7%
- Q3: 4.9%
- Q4: 5.1%
Specific Factors that Affect Nebraska Mortgage Rates
Since no two families’ situation is the same, lenders look at many different factors when offering you a mortgage. The state and federal economy matters, for example, as do global events like wars going on overseas. Paying attention to the economy is one way to lock in the best rates. Consider how the financial problems in Greece affected the world economy, for instances. In U.S., it actually pushed interest rates lower because U.S. bonds were considered a safe investment.
There are also personal statistics that lenders take into account when creating a mortgage plan for you.
- What is your credit score?
- Is this your first mortgage?
- What is your employment situation?
- Are there one or more incomes to support the family?
- How much money do you have to put down?
Lenders have a point system in place that directly affects interest rates. Points are pre-paid interest. A point equals one percent of the loan amount. If you are applying for a 400,000 dollar loan, each point has a value of 4,000 dollars. Borrowers pay points to lower the amount of interest they borrow as part of the loan.
Interest rates drive up the monthly payment for a mortgage. Points are one way to bring it down to an affordable rate. By offering to pay points in advance along with the closing costs, you are lowering the amount of the interest on the loan and reducing the total you borrow.
As you shop the Nebraska home market, keep in mind that rates are likely to go up and lock down early in the year if possible. Do your research on mortgage lenders, too. There will be a wide variation between them and many different products available. A perfect credit score isn’t an absolute necessity, but go through your credit reports before applying, so you make the best possible impression. The rate will depend greatly on that score, so clean up any errors prior to applying for the loan.
2 Point Highlight
Experts predict mortgage rates will be erratic in 2016, but go up considerably.
As of February, the national average for 30-year fixed loans is down to 3.5.
