Grandfather and Grandmother Farmer's last home mortgage, something they took out in the late 1950s and paid off in 1975, was at 4-3/4%, fixed for 20 years. I equalled that in 2004, but with a 5/1 adjustable loan, not a fixed-rate loan.
Last week came the bank's letter with the first adjustment. I opened it with all the enthusiasm that my friends applied to unsealing their letters from the Selective Service Administration during the Vietnam War.
To my surprise, my rate is going down, to 3-1/2%. I don't know how my lender can make a profit at this rate, but my lender doesn't care; it's undoubtedly packaged this loan and many others into mortgage-backed securities, sold its interest, and recouped its capital with a profit, and now acts merely as a servicer.
Even now, several days later, I still beam when I read the letter, much as I do when I reread Mrs. Laquedem's first letters to me. I'm tempted to frame the bank's letter, but it's printed on very cheap paper. At 3-1/2% I shouldn't expect anything finer; but if next year my rate jumps into the sixes, I'd like the notice to come on cotton bond, with some gilt if the rate's seven percent or higher.
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