Guess what I saw?
I went into a WaMu (or Chase or whatever the hell they're calling themselves these days) and when I got through with my "bidness", I noticed a flyer (flier?) that looked out of place, so I picked it up AND NOW I'M SHARING IT WITH YOU.
It's got the WaMu brand on it, and says:
"Can we interest you in INTEREST-ONLY?"
I guess either Chase hasn't gone through and done any cleaning of the mortgage departments in their shiny new purchase, or they don't care to learn from the mistakes of the past. Sure, it's a 30 year *fixed interest* loan, but it's still *DING DING DING* interest-only for the first ten years, because down at the bottom it reads "... this is an interest-only loan and, as such, your APR, interest rate, and monthly payments may increase significantly after the initial 10-year interest-only period. ... at the end of the interest-only period, your payment will be recast as a fully amortizing payment and will therefore increase. For these reasons, after the initial fixed-rate period, your monthly payments could increase substantially (sometimes called "payment shock").
So I guess the bold letters at the top that say "Fixed-Rate Interest-Only Mortgage" missed putting the * after it so you remember to read the fine print about the original fixed rate being in effect only for the first ten years.
Edit: I just noticed something in between the "top billing" and the small print, reading:
"With this loan, you can relax with the stability of a fixed interest rate for 30 years." So which is it? "A" fixed rate or "two" fixed rates, one for ten years, one for the rest of the loan?
It's got the WaMu brand on it, and says:
"Can we interest you in INTEREST-ONLY?"
I guess either Chase hasn't gone through and done any cleaning of the mortgage departments in their shiny new purchase, or they don't care to learn from the mistakes of the past. Sure, it's a 30 year *fixed interest* loan, but it's still *DING DING DING* interest-only for the first ten years, because down at the bottom it reads "... this is an interest-only loan and, as such, your APR, interest rate, and monthly payments may increase significantly after the initial 10-year interest-only period. ... at the end of the interest-only period, your payment will be recast as a fully amortizing payment and will therefore increase. For these reasons, after the initial fixed-rate period, your monthly payments could increase substantially (sometimes called "payment shock").
So I guess the bold letters at the top that say "Fixed-Rate Interest-Only Mortgage" missed putting the * after it so you remember to read the fine print about the original fixed rate being in effect only for the first ten years.
Edit: I just noticed something in between the "top billing" and the small print, reading:
"With this loan, you can relax with the stability of a fixed interest rate for 30 years." So which is it? "A" fixed rate or "two" fixed rates, one for ten years, one for the rest of the loan?