Here’s an even better story about a banker. The branch manager at World Savings in Rancho Bernardo, when trying to allay my concerns about keeping my CD there, told me that ARMs were nothing to worry about.
He said, “I have an adjustable rate mortgage, and my payment hasn’t gone up. Why do you say they go up?”
My reply, “That’s because you haven’t hit your adjustable period yet. Your 4% rate can go to 6%”
He responded, “But that’s only a 2% increase”.
I tried again, “It’s a 2% increase in the rate, but a 50% change in the rate. Your $2,000 payment would go to $3,000 if your rate changed from 4% to 6%.”
I think he got it. I hope he reviewed his mortgage details.
The only worse thing was the low-cut shirt worn by one of the lady tellers. Whatever happened to professionalism and competence?