GDW COSI ~ Cost of Savings Index ~ Mortgage (ARM) Indices

Since the merger of Wachovia and World Savings the Wachovia family of companies no longer uses the original COSI index for new mortgages (though it is still being published for existing mortgages until they are migrated over to the Wachovia COSI).

Definition of the original COSI

The Golden West Financial Corporation Cost of Savings Index (GDW COSI) is the weighted average of the rates of interest on the deposit accounts of the federally insured depository institution subsidiaries of Golden West Financial Corporation (GDW). All of the depository institution subsidiaries of Golden West Financial Corporation operate under the name World Savings.

World Savings receives money from consumers in the form of deposits and lends money as home or other loans. The interest rates in effect on these deposits are the basis for the GDW COSI index. It is not based on actual interest paid, but rather the weighted annualized average of all interest rates in effect on World Savings deposit accounts on the last day of each month.

Both the original COSI (GDW COSI) and the W-COSI (Wachovia COSI) adjust monthly and have a one-month reporting lag. They are computed on the last day of each calendar month and are announced on or near the last business day prior to the fifteenth day of the following calendar month.

COSI vs. 1-Yr CMT, 6-Month CD, 1991-2007 { Obtaining Permission to Reproduce }

The Cost of Savings index considered to be among the most stable ARM indexes in the industry. It is one of the most widely used Option ARM loan indexes.

Many COSI-indexed ARMs often have minimum payment change caps (usually, up to 7.5% of minimum payment amount), as well as lifetime interest rate caps (usually, about 12%) but no periodic interest rate caps creating the possibility for negative amortization.

Mortgage Professionals Offering COSI-indexed Loans: If you are looking for a COSI-indexed ARM and need more information or advice, we invite you to take advantage of our database of the most competitive lenders available. Just complete a short loan request form and the best lenders in your local area will contact you with their rates and fees.

Wachovia COSI or CODI? Wachovia converts GDW COSI-indexed arms to the new Wachovia COSI.

Historical Data: Mortgage-X compiles historical values for the indexes which are widely used on adjustable rate mortgages (ARMs):

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