Having trouble qualifying for a mortgage? Ben S. Bernanke, former chairman of the Federal Reserve, has the same problem. Bernanke, now a think tank consultant who earns a reported $250,000 for giving one speech, recently told a Chicago conference that he’s had a hard time refinancing his Washington, D.C. home.
“Just between us,” Bernanke said, “I recently tried to refinance my mortgage and I was unsuccessful in doing so,” Bloomberg News reports.
At first glance, this does not compute. Bernanke, who led the country and economy through the financial crisis, surely is no pauper, though he did buy his house during the real estate boom in 2004 for $839,000; it’s currently assessed for $815,000, said the The New York Times after looking at D.C. property records.
But Bernanke did commit the mortgage crime of changing jobs a few months ago, which, in the nether world of mortgage finance, makes him a credit risk.
I feel your pain, buddy. As a contract writer, I have a constantly revolving client list. And even though I’m doing well, thank you very much, mortgage officers have looked at my pay stubs from different employers as so much trash. One mortgage officer said none of my income would qualify until I worked for the same company for three years — an eternity in the writing game.
Not sure that’s the same problem as Bernanke: Just had to get if off my chest.
But the former head of U.S. financial policy recently left an eight-year gig with the Federal Reserve, where he got a steady paycheck, for the more unpredictable world of consulting and speechifying and book writing.
Bernanke revealed his mortgage troubles (cry me a river) to show that U.S. credit is still tight. And one reason is that inflexible lending formulas are deciding creditworthiness, rather than human mortgage officers (well, maybe human is overstating it).
Some say this tightness is holding back the U.S. housing market from a faster recovery.