Friday, November 30, 2007

CNN REPORTS: Fed Chairman hinting at interest-rate cut

Wall Street: Thanks, Bernanke

Comments from Fed Chairman hinting at interest-rate cut at next meeting spark broad buying on Wall Street.

November 30 2007: 10:16 AM EST

NEW YORK ( -- Stocks jumped Friday morning after Fed chairman Ben Bernanke hinted that the central bank is likely to cut interest rates at the next policy meeting, reassuring investors worried about the ongoing turmoil in financial markets.

Click read the entire article on CNN Money site

Thursday, November 29, 2007

Super Cool web resource Tool if you are buying or selling

What’s your home worth? Get a quick estimate on your home’s value and view comparable sales in your area!

To contact Kristin Abouelata for Home Loan services please call (865) 567-0113

Wednesday, November 28, 2007

USA TODAY REPORTS Stocks surge after Fed official hints of rate cut

By Adam Shell, USA TODAY

NEW YORK — Stocks zoomed higher for the second straight day Wednesday on Wall Street amid renewed hopes of an interest rate cut by the Federal Reserve to ease some of the turbulence in housing and credit markets.

(Click here to read entire article)

Saturday, November 24, 2007

What are all these fees and why is a mortgage so expensive?

Not only are the expenses associated with a mortgage hard to understand, people often wonder why a loan costs so much. Here's a little background info to explain why home financing isn’t cheap…

Did you ever wonder what a great credit score really gets you in the mortgage market? Many people think it means they get better pricing. Unfortunately, that’s not really the case. It mostly just means your lender won’t have to hassle you for as much documentation to do your loan. In fact, no documentation may be required from you at all if it’s a purchase and you put enough money down. I’ve heard many clients say, “I’ve got great credit, so quote me your best rate.” Good credit can’t directly influence the rate. But it can influence your mortgage loan officer to give you better pricing. If your lender can be assured your loan process is streamlined and smooth, and that they won’t have excessive hours to devote to the process, they may be able to quote you a more competitive rate. Much about a quoted rate depends upon the man hours it will take to make your loan, the loan amount itself and how quickly you can close.

Lenders usually have a minimum percentage of income they are supposed to make on a loan. That percentage is flexible, but only to a certain extent. For instance, the loan amount size is a huge contributing factor. If you’ve got a really large loan amount, your lender doesn’t need to have a feeding frenzy on your loan. The percentages lower because the payback is higher.

However, if you’ve got a really, difficult loan and a modest loan amount, you can expect higher rates or discount points. Or fees. Some lenders may raise your fees to make you think you’re NOT paying as much. But you are. You have to in order for the lender to cover the cost of doing business.

Here’s the secret. Closing a loan is actually a very involved process. Lenders can’t do the loans for free or break even profit because it’s a business and their in it for profit. Plus, there are many people involved in the loan process that you aren’t even aware exist. Processors, closers, post closers, insurers… a staff of thousands! Ok, so maybe not thousands, but your file is probably touched by 5+ different divisions (at minimum) within a mortgage company. Since it is a business, the lenders must make enough money on the loan to cover their costs and actually make money, too. The lender also pays outside parties for services too, like the appraisal, flood cert and automated underwriting system. Paying your originator is just the beginning of the mouths (and families) being fed by your business. It ain’t cheap to close and sell a mortgage.

When you examine all the fees and charges on a good faith estimate, your lender should be able to tell you exactly where that money is going and how it is to be spent. Your lender should have no qualms in telling you what costs are associated with your loan, or which funds cover third party expenses that your lender incurs by doing your loan. And some of that money will be profit. Much of it may be. But remember, you’re not just paying the salary of only one person. However, you shouldn’t pay too much for your loan. After all, the lender will make additional profit on the loan when it is sold on the secondary market.

A good lender will validate any fees and charges for you and should make you feel ok with the fees. If they don’t seem reasonable or fair, always ask questions. If you don’t like the answer, say so. And if you still don’t like the answer, than look for a new lender. Buying a home is such an important purchase and you should feel good about it.

Let my experience work for you! Email your home loan financing questions to Kristin Abouelata, Home Loan Specialist, at or call (865) 567-0113. Kristin will try to answer all questions on her website Home Loans Plain Talk.

Kristin Abouelata
Mortgage Specialist
Let my experience work for you!
Knoxville, TN 37919
Phone: 865-567-0113

Thursday, November 15, 2007

Giving Thanks to the FHA for It’s Adjustable Rate Mortgage Solution!

MSNBC reported recently that the third quarter saw a 30 percent jump in foreclosures, and 45 out of 50 states report increased levels. This recent news seemed like a good reason to revisit this very real problem. Many will be “thankful” the FHA has come up with a temporary program known as “The FHASecure Initiative,” that may give some relief.

A gentleman called me the other day about what he could do about his adjustable rate mortgage (ARM) that would soon be adjusting or in plain talk, reflecting a significant payment increase. Like so many homeowners, he did not anticipate the tightening of underwriting requirements and being stuck with his dramatic mortgage payment reset he couldn’t possibly afford.(go to the articles section of for more information on ARM loans). Most of us sweat when we go to the grocery store and find out we spent $250.00 on groceries instead of our budgeted $150.00. Facing a huge jump in our mortgage payment would give a large majority of us heart palpitations! This situation is difficult for those with ARM loans about to reset. To make matters worse, many of these homeowners are boxed out of conventional financing because of recent, more stringent underwriting guidelines imposed.

What can be done?

The Federal Housing Administration (FHA) has released a new initiative which enables homeowners to refinance their mortgage when faced with adjusting mortgages that they can no longer afford. The program, known as “The FHASecure Initiative,” is a temporary program, and applications must be signed no later than December 31, 2008. I am going to repeat this point because it is important. An application must be signed no later than December 31, 2008. If you even think this program is something you should consider, do your homework now. Get a mortgage specialist to help you through the details of where you are today, what could happen tomorrow and what you can expect from this FHASecure Initiative program. If you do not have a mortgage specialist go to your bank, ask a friend or realtor for a name of a mortgage specialist, or call me.

The FHASecure Initiative allows lenders and homeowners to refinance mortgages which may result in delinquency once the loan is reset, or in some special circumstances, even if the loan has already become delinquent.

The mortgages in question must involve non-FHA adjustable rate mortgages where the homeowner’s mortgage payment history during the 6 months prior to the reset showed no instances of late payments. If there is sufficient equity in the home, with some further strings attached, you may be able to refinance even if you’re currently behind in payments. The lender must prove that with an FHA refinance, the borrower has enough income and reserves to make payments under FHA’s guidelines. Still confused? Contact a mortgage specialist to help you sort through these guidelines as they apply to your situation. Remember, asking the questions is simply educating yourself and will not obligate you in anyway. It’s about protecting your hard earned investment and safeguarding your credit history.

Nationwide, FHA will loan money based upon 97.75% of the appraiser’s estimate of value. The maximum mortgage amount allowed for a single family home varies depending upon you live. There is no income limit for this product, and individuals with credit scores below 620 may qualify for financing. FHA will allow you to roll the first lien, and second mortgage used to purchase the home originally, closing costs, prepaid expenses, discount points, prepayment penalties, and late charges. In a nutshell, it is a fairly flexible product that might be just what the doctor ordered for some of us.

In summary, this product is an excellent solution for many of those subprime mortgages or ARM products we’ve heard so much about on the news. Hopefully, if you are one of those borrowers, this article can open a door for you were afraid was about to slam shut! Oh, and by the way, did I mention that the FHASecure Initiative is a temporary program, and applications must be signed no later than December 31, 2008?

Please email your home loan financing questions to Kristin Abouelata, Mortgage Specialist, at or call her directly for more information at (865) 567-0113. Kristin will try to answer all questions on her website Some questions and answers may be published with future articles.

Monday, November 12, 2007

Email your home loan financing questions to Kristin Abouelata

Email your home loan financing questions to Kristin Abouelata, Home Loan Specialist, at or call (865) 567-0113.

Kristin Abouelata
Mortgage Specialist
GreenBank - Let my experience work for you!
5000 Kingston Pike
Knoxville, TN 37919

cell: 865-567-0113 (preferred)
office: 865-291-3931
fax: 865-291-3920

Tuesday, November 6, 2007

Buying Your First Home, It’s Easier Than You Think! – Now what? Part III

For a first time homebuyer, once you’ve found a house and been pre-qualified for a home, the steps to closing can be somewhat confusing. It’s actually a simple process that when understood, actually makes sense.

You have found the perfect house. You can’t believe that you are actually buying it! You thought buying a house was only for old people with kids, you know, like in their thirties or something. Now what happens?

You’ve should already have been pre-qualified for a home loan by a mortgage specialist. In fact, that lender gave you a letter, saying as much, and you gave it to the seller, giving them peace of mind that your offer is real and you can back it up. Your credit has probably already been pulled and you’ve been given a copy of it. Your realtor will provide the fully executed sales contract to your lender. Upon receipt of this contract, your lender will update and get you all your documents and disclosures to sign, within three days of receipt of your contract. If your credit has already been pulled and you’ve seen these documents, expect a NEW set since you finally have a property in mind. And trust me, this is only the beginning of the deluge of documents you will see, sign and sign again.

Your lender will now go back to your loan and put in all the particulars of this property - such as taxes, homeowner’s association fees - and reflect any earnest money you may have put down with the contract. At this point, with a property determined, you can explore locking in an interest rate or reserving funds if the loan is through a particular housing agency. Your lender will also want to collect and update documentation that proves all you have related about yourself. I call it “eye balling” the documents. Assessments will be made if there is further documentation required to substantiate your loan application.

When all contract contingencies are removed, the lender will order the appraisal for your property. The lender chooses the appraiser and the type of appraisal necessary to ensure the value of the property. After all, it’s the lender’s money on the line, and in case you don’t repay your loan, the value of the loan may have to recouped in a foreclosure sale of the property. Not likely to happen, but the lender will make sure they are protected by the appraisal. The appraiser will notify all parties involved that there may be repairs required before the value can be found or the property will adhere to a certain standard required by the lender. The lender will communicate this information to your realtor to negotiate the repairs with the seller.

The lender prices, processes and assembles your loan for underwriting. They order title work from your chosen title company and coordinate all the pieces of the puzzle for the closing. They collect your homeowner’s insurance and share this information with the title company. The title company searches the title and rectifies any outstanding liens for closing. Sometimes, the title company finds old tax liens or worker’s liens (known as materialmen’s liens). They make sure that these liens will be satisfied prior to you taking ownership to the property. They also make sure that everything historically has been recorded and released properly.

Once the appraisal is received and the documents are submitted to underwriting for final approval, the lender receives an underwriting decision. Sometimes, there may be something in your file that will cause an underwriter to ask for more documentation. Sometimes, an underwriter will ask for additional comparable sales of homes in the area for the appraisal. Many times, a customer never knows that these conditions arise because their lender anticipates or addresses them for them. Sometimes a customer may be contacted for information. But, your mortgage specialist should have a good assessment of the situation and be able to validate and explain anything they ask of you.

Two days before closing, you will receive a HUD-1 Settlement Statement from your lender and/or title company. This document is summation of all the charges and fees in connection with your loan. You will be asked to review this document to ensure that it is correct. It will also reflect how much cash you will need to bring to closing.

At the closing, all parties involved usually show up at the same time to sign documents. Sometimes, the seller and the buyer sign separately due to scheduling conflicts. Your realtor and your lender should be expected to attend your closing. You will sign a stack of huge documents, but when all is said and done, you will handed the keys to your new home!

Your lender, realtor and title company should all work to make this process as seamless for you as possible. Their job is to make this experience an informed, easy and worry free process. You will have to make certain decisions, but you should be informed so that they do not overwhelm you. It’s easy to forget how mind boggling all the documentation can be in the home loan process when are exposed to it every day as part of your job. Your lender should be patient and explain things simply -no smoke and mirrors. Buying a home doesn’t need to be difficult or stressful. A good lender will make it exciting and educational!

Because you can, visit: Home loan Knoxville TN

Friday, November 2, 2007

Reported in USA Today: Mortgage rates drop to the lowest level in 5 months

WASHINGTON (AP) — Rates on 30-year mortgages fell to the lowest level in five months as evidence mounted that the economy is slowing down.
Freddie Mac, the mortgage company, reported Thursday that 30-year, fixed-rate mortgages dipped to 6.26% this week, down from 6.33% last week. It was the lowest level since 30-year mortgages were at 6.21% the week of May 17.

Click to Read the complete article in USA Today

Thursday, November 1, 2007

USA Today reports: Fed signals it may be done cutting rates for now

By Sue Kirchhoff, USA TODAY

WASHINGTON — The Federal Reserve cut a key short-term interest rate by a quarter-point Wednesday to 4.5%, but cautioned markets not to count on more reductions.
The central bank said the rate move, along with a half-point cut in September, "should help forestall some of the adverse effects on the broader economy" that could result from housing and financial turmoil, while helping promote "moderate growth."

Read the the rest of the article on USA TODAY...