ARMs have been around for a while, and definitely predate Ford’s presidency. My parents bought their house in South America in early 1974 with a 20-yr ARM. In fact, some have recently commented (here in the USA) that people routinely use ARMs in many foreign countries, and that perhaps fixed rate mortgage homebuyers in the US overpay for the convenience of a fixed payment.
In my parents’ case, the contract stipulated all sorts of ceilings that the variable rate could not exceed in the future. We entered a high-inflation period in the late 70s and early 80s, with nominal interest rates going through the roof, but the impact on our payments was limited thanks to the rate ceilings prescribed in the contract. Thanks to inflation, my parents got a sweet deal on that house…
And 30 years later a got a similar windfall when I cashed out at the peak of the So Cal RE bubble!
