NIFA’s homeownership programs have assisted more than 87,000 households in Nebraska purchase a home. Our programs offer competitive interest rates, low or no downpayments, closing cost assistance and government or conventional loans. We have a network of approved Participating Lenders who are located all across the state. These lenders process all of our loans, they understand our programs and are ready to help your buyers.
This section explains NIFA's eligibility requirements for your buyers to qualify for one of our loan programs.
At NIFA, we define a first-time homebuyer as someone who has not owned and lived in a home as their primary residence within the past three (3) years. If your client previously owned a home, and has been renting for the past three or more years, NIFA considers them a first-time homebuyer.
The first-time homebuyer requirement does not apply when (1) Your client is a Qualified Veteran who has been honorably discharged from the service or (2) Your client purchases a home located within one of our target areas.
There are certain situations for which NIFA may grant an exception: (1) If your client lost their previous home by divorce and received no sale proceeds, (2) If your client lost their previous home by natural disaster, or (3) If your client lost their previous home by forced job relocation.
All NIFA programs have maximum income limits that are determined by the location of the home and household size. NIFA will take into account all gross sources of income for individuals 18 years or older who will live in the home as their primary residence. This includes, but is not limited to, base pay, overtime, commissions, bonuses, tips, self-employed income, social security, disability, unemployment, child support, alimony, part-time income and interest income from assets in excess of $5,000.
Your client's current monthly household gross income will be projected over a 12-month period. This calculation method is only used to determine NIFA program eligibility. The Participating Lender will use a more conservative approach to determine qualification for loan credit underwriting guidelines.
Maximum income limits are subject to change from time to time.
Your clients can purchase a home located in Nebraska as long as the price does not exceed our established limits.
NIFA borrowers must live in the home as their primary residence. For 2-4 unit properties, the borrower will need to occupy one of the units and NIFA will include net rental income for the other unit(s) in their total household income. 2-4 unit properties must be at least 5 years old unless they are a duplex located in one of our designated target areas.
If your client is buying a property from a relative, the greater of the purchase price or appraised value cannot exceed the maximum limit.
In addition to NIFA's program eligibility requirements, credit underwriting guidelines apply. Credit underwriting guidelines include minimum credit scores and maximum debt-to-income (DTI) ratios. They differ depending on the type of loan.
Conventional Loans - The minimum credit score requirement is 640 with a maximum total DTI ratio of 45%. If the buyer's credit score is 660 and above, NIFA will allow a maximum total DTI of 50%. If the Participating Lender needs to use manual underwriting guidelines to approve the loan, the minimum credit score requirement is 660 with a maximum housing expense ratio of 31% and a maximum total DTI ratio of 43%. If the buyer does not have a credit score, they may still qualify for a loan subject to a maximum housing expense ratio of 31% and a maximum total DTI ratio of 43%.
Government Loans - The minimum credit score requirement for government and conventional loans is 640 with a maximum total debt to income ratio of 45%. If the buyer's credit score is 660 and above, NIFA will allow a maximum total debt to income ratio of 50%. If the Participating Lender needs to use manual underwriting guidelines to approve the loan, the minimum credit score requirement is 660 with a maximum housing expense ratio of 31% and a maximum total DTI ratio of 43%. If the buyer does not have a credit score, they may still qualify for a loan subject to a maximum housing expense ratio of 31% and a maximum total DTI ratio of 43%.
The buyer's Participating Lender will determine if they meet all of NIFA's program eligibility guidelines and credit underwriting guidelines.
NIFA requires all occupying borrowers who are responsible for repaying the loan to complete an approved homebuyer education class prior to closing. It is highly recommended that you encourage your clients to complete an education class before they begin the home shopping process. They will gain valuable knowledge on the loan process, terminology, budgeting, home inspections and home maintenance and be a more informed buyer.
NIFA allows face-to-face education and online education. We partner with a network of non-profit organizations called REACH Affiliates who provide face-to-face education and other housing resources. To find a REACH Affiliate near you, visit the Nebraska Housing Developers Association website or call 888-879-3403. Click here for a list of approved online classes.
The property financed under NIFA's program must be occupied by the borrower as their principal residence within 60 days of loan closing.
No more than 15% of the total area of the property may be used for business purposes, such as a daycare. Your buyers will complete NIFA’s Affidavit 1 to make this representation.
A Qualified Veteran is defined by the federal government within the meaning of 38 U.S.C. Section 101, stating the borrower must have served in the active military and has been discharged or released from the service under conditions other than dishonorable. A veteran or spouse of a deceased veteran does not have to be a first-time homebuyer and must provide a copy of their deceased spouse's Certificate of Release or Discharge from Active Duty Form (DD Form 214).
Buyers purchasing in federally designated target areas are not required to meet the first-time buyer requirement. These areas are located within a portion of Douglas, Lancaster, Jefferson, Scottsbluff and Adams counties. You can determine the census tract of a property by using the FFIEC geocoding system website. Click on one of the links below to identify target area census tracts by county: