8-330. Loans; charges authorized; statement; interest rate.
551 words·~3 min read·
/ne/chapter-8/8-330A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Every association may require borrowing members to pay all reasonable expenses incurred in connection with the making, closing, disbursing, extending, readjusting, or renewing of real estate loans. Such expenses may include abstract, recording, and registration fees, title examinations, survey, escrow services, and taxes or charges imposed upon or in connection with the making and recording of any mortgage. Such reasonable charges may be collected by the association from the borrower and shall not be considered interest or a charge for the use of the money loaned.
A charge not exceeding one percent or that allowed a federally chartered association for the premature prepayment may be made. The rate of interest on any loan of money shall be determined and computed upon the assumption that the debt will be paid according to the agreed terms and in the event the loan is paid or collected by court action prior to the term of the loan, any payment charged, received, or taken as an advance or forbearance which is in the nature of and taken into account in the calculation of interest, shall be spread over the stated term of the loan for the purpose of determining the rate of interest.
Any amounts paid or contracted to be paid by persons other than the borrower shall not be considered interest and shall not be taken into account in the calculation of interest. Interest may be paid on escrow accounts held for the payment of taxes, insurance, and similar payments, if agreed to in writing by the borrower and association. Loans may be made by an association under a license granted it pursuant to the Nebraska Installment Loan and Sales Act, to borrowing members whose loans are secured by real estate, to the same extent and in the same amount as such loans may lawfully be made to nonborrowing members.
The association shall furnish a loan settlement statement to each borrower, indicating in detail the charges and fees such borrower has paid or obligated himself or herself to pay to the association or to any other person in connection with such loan. A copy of such statement shall be retained in the records of the association.
An association may charge and receive interest, on property improvement loans including loans made under Title I of the National Housing Act, as amended, and unsecured loans authorized in section 5(c) of the Home Owners' Loan Act, as amended.
Payments contracted for as interest and premium on loan only are to be considered in determining usury. Eastern B. & L. Assn. v. Tonkinson, 76 Neb. 470, 107 N.W. 762 (1906).
Foreign associations doing business in this state are subject to penalties against usury. Anselme v. American S. & L. Assn., 66 Neb. 520, 92 N.W. 745 (1902); People's B. L. & S. Assn. v. Parish, 1 Neb. Unof. 505, 96 N.W. 243 (1901).
Under former act, section was only applicable to domestic associations, and foreign associations were governed by general usury statute. National Mut. B. & L. Assn. of New York v. Keeney, 57 Neb. 94, 77 N.W. 442 (1898).
Interest may be reserved at highest rate permitted by law on face of loan, premiums deducted from that, and difference only paid to borrower. Livingston L. & B. Assn. v. Drummond, 49 Neb. 200, 68 N.W. 375 (1896).