Meanwhile, the Federal Reserve Board chairman told a credit union convention that fixed-rate mortgages are an expensive way to finance a home, and he challenged the industry to come up with new products."American consumers might benefit if lenders provided greater mortgage product alternatives to the traditional fixed-rate mortgage," Mr. Greenspan said. Homeowners with fixed-rate mortgages paid a high premium over the past 10 years for the right to refinance and to protect themselves from spikes in interest rates, the Fed chairman said. "Indeed, recent research within the Federal Reserve suggests that many homeowners might have saved tens of thousands of dollars had they held adjustable-rate mortgages rather any fixed-rate mortgages during the past decade, though this would not have been the case, of course, had interest rates trended sharply upward," he said.

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