Ben Bernanke Bits

I have been glued to the television watching two days of testimony from Fed Chairman Ben Bernanke to the House and Senate.   Maybe I'm a mortgage nerd, I find this amazing.   

I'm convinced a majority of our elected officials are there just to grandstand and don't have a clue about their personal mortgages!   Many of our representatives are treating Mr. Bernanke as if he personally doled out inappropriate subprime mortgages in an abusive fashion.    Other random tid-bits that I found interesting from the Q&A sessions are:

• Bernanke mentions the "wealth effect" that home ownership provides Americans. 
• The lower third of Americans have less than $500 in savings.   It is crucial to have at least 3 months of gross income in savings in the event of an illness, unemployment, etc.   
• Bernanke stated that home owners with ARMs (adjustable rate mortgages) should call their lenders well in advance prior to their rate/payment adjusting.   I recommend calling at least six months prior to a scheduled rate increase to have your credit reviewed in the event corrections or repairs need to make sure you're in the best position to refinance.
• Suitability was defined by Bernanke as being more about affordability and the ability to repay a mortgage and less about selecting the right program out of the dozens or so available for a borrower.
• Many borrowers took out mortgages without understanding the terms. 

I watched as much of the two day testimony as possible...ah, I'm glad I'm not Ben!

To read his prepared testiomony, click here.