Roger Schlesinger
To me an A.P.R. means Another Problem for Roger. It is the government's attempt to have the mortgage industry explain their entire operational slate in one simple manner. This is impossible and thus helps render this as useful as teaching David Letterman manners (seems like it could work, but it doesn't). I contend that if the selective memory borrowers or liars, who swore with a straight face they never understood the 1% option ARM (Adjusted Rate Mortgage) and therefore aren't responsible for the results, I can't imagine what they could do with a seven year ARM at the start of the first or second variable period. As my baseball coach used to say, "as sure as God made little green apples," we will be hearing from the same folks who had an option ARM (see above) who refinanced to a short term fixed ARM swearing someday, to anyone in Congress that would listen, that they expected the rate to go down after the fixed period because the A.P.R. was lower than the fixed rate portion of the loan. Who is to blame for that little bit of chicanery?

The answer to that question is the government. The A.P.R. idea was started for cars which are generally financed three to five years. If you could look at the Annual Percentage Rate, you quite possibly would pick the lowest interest offer instead of trying to figure it out for yourself. Hint: The government doesn't think you are very smart. As my mother would have said to that, "likewise, I'm sure." What works for automobiles, although we aren't that positive as all the American car manufacturers are bankrupt (except Ford), doesn't come close to working for the mortgage or home finance industry. We finance homes for 1 year up to 40 or 50 years and during that time, the rate can change 100 times. Put that in a formula and let the people use it!


Roger Schlesinger

Roger Schlesinger's Mortgage Minute is heard on hundreds of radio stations and daily on the Hugh Hewitt radio show and Michael Medved shows. Roger interacts with his hosts and explores the complicated financial markets in order to enlighten his listeners and direct them along their own unique road to financial freedom.



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