[Verse 1]
When interest rates start to climb so high
Your floating payments make you cry
But there's a tool to ease your pain
A cap will keep you safe from strain
It's like insurance for your loan
Protection that you'll call your own
[Chorus]
Caps protect when rates go up up up
Floors protect when rates drop down down down
Option-like they guard your way
Strike rate sets the price you'll pay
Caps and floors will save the day
Interest rate protection all around
[Verse 2]
A floor works when the rates fall low
Your income stream won't disappear below
The strike rate is your safety net
The minimum return you'll get
Like options but for interest rates
These tools control financial fates
[Chorus]
Caps protect when rates go up up up
Floors protect when rates drop down down down
Option-like they guard your way
Strike rate sets the price you'll pay
Caps and floors will save the day
Interest rate protection all around
[Bridge]
Borrowers love caps the most
Lenders want floors coast to coast
Pay a premium for this right
Sleep soundly every single night
Reference rate versus strike rate
Determines payoff calculate
[Verse 3]
When reference rate exceeds the strike
The cap kicks in just like you'd like
But if it stays below that line
You pay your normal rate just fine
For floors it works the other way
Minimum income comes your way
[Chorus]
Caps protect when rates go up up up
Floors protect when rates drop down down down
Option-like they guard your way
Strike rate sets the price you'll pay
Caps and floors will save the day
Interest rate protection all around
[Outro]
Risk management made so clear
Caps and floors remove your fear
Strike rate is the key you see
Interest rate security