October 5, 2014

Ben Bernanke mortgage refinance application rejected

From CBC News:

Ben Bernanke mortgage refinance application rejected

Lenders might be tightening up too much, former U.S. Fed chairman says

Oct 03, 2014 12:11 PM ET Pete Evans, CBC News

Former chairman of the U.S. Federal Reserve Ben Bernanke was rejected by a bank recently when he tried to refinance his mortgage.

According to financial news agency Bloomberg, Bernanke told an investor conference in Chicago that he recently applied to refinance the mortgage on his Washington, D.C.-area home and was turned down.

"Just between the two of us,” Bloomberg quoted him as telling the audience. “I recently tried to refinance my mortgage and I was unsuccessful in doing so.”

When the comment drew laughs, he added “I’m not making that up.”

“I think it’s entirely possible” that lenders “may have gone a little bit too far on mortgage credit conditions,” he said.

Refinanced twice already

Bernanke reportedly bought his home in 2004, slightly before he was named as America's top central banker and the man with more control over lending rates than anyone else on Earth.

He held that job from 2006 until earlier this year, when he was replaced by Janet Yellen. According to public documents, his salary was $199,700 a year, which should be enough to cover the carrying costs of a mortgage on a home in any of Washington's toniest neighbourhoods. (The salary has since gone up, as Yellen makes $201,700 a year to run the Federal Reserve.)

He refinanced the home in 2009, then again in 2011. And based on his comments this week, it appears he was rejected by a bank when he tried to do so again recently.

Since leaving the Fed, Bernanke has taken a job at economic think-tank the Brookings Institution, where his compensation is not known.

But he also reportedly takes in a reported six-figure salary for speaking engagements — none of which apparently make him a worthy credit risk under tough new lending rules that U.S. banks were forced to implement under his watch.