Nebraska Bad Credit Mortgage Lenders

Home ownership in Nebraska is slightly higher than the national average, with 67.4% of dwellings being owned rather than rented (compared with the national average of 66.2%). While the percentage of home ownership in Nebraska is slightly higher than average, many people with mortgages faced the dangers of predatory lenders. Thankfully, the state has recently added legislation to deal with the predatory lenders as it was felt that the federal regulations were “Too lenient” and “Toothless” when it came to actually enforcing them. Known as Ney’s bill, the new state legislature makes borrowing in Nebraska safer for home buyers.

The most recent drafts of Ney’s bill would pre-empt any state or local laws, including those that "afford additional substantive protections." This makes the new bill quickly enforceable, and means authorities can act within a reasonable time frame in response to unfair or unscrupulous lending practices.

It also wipes out a recent regulatory ruling mandating that state-chartered thrifts and independent mortgage companies cannot evade state limits on late fees and prepayment penalties on adjustable-rate mortgages and other alternative loans.

Taking the place of strong state and local law, the "Responsible Lending Act" establishes protections. It would outlaw prepayment penalties beyond four years for high cost loans. Prepayment penalties are traps on abusive loans since borrowers must often pay thousands of dollars in order to refinance out of abusive loans.

The Sarbanes' bill, in contrast, would outlaw prepayment penalties beyond two years and cap the amount of prepayment penalties. Segments of the lending industry have already voluntarily limited the duration of prepayment penalties to shorter terms than the Ney bill proposes.

There are oversights however, as the Ney bill would place no limit on the amount of points and fees that are financed or added to the loan amount on high-cost loans.

Predatory lenders lure borrowers into abusive loans by artificially lowering the immediate costs of exorbitant points and fees by adding them to the loan amount.

This recent addition of state legislative protection for the home buyer means that the worries one might have had about lending companies in Nebraska is lessened. With the importance and magnitude of a mortgage, one should be certain that the lending institute one is dealing with is all above board. That just got easier in Nebraska.