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11th District Cost of Funds Index (COFI)

11th District Cost of Funds Index FAQ + National Monthly Median Cost of Funds Index + Federal Cost of Funds Index

This index reflects the weighted-average interest rate paid by 11th Federal Home Loan Bank District savings institutions for savings and checking accounts, advances from the FHLB, and other sources of funds. The 11th District represents the savings institutions (savings & loan associations and savings banks) headquartered in Arizona, California and Nevada.

Since the largest part of the Cost Of Funds index is interest paid on savings accounts, this index lags market interest rates in both uptrend and downtrend movements. As a result, ARMs tied to this index rise (and fall) more slowly than rates in general, which is good for you if rates are rising but not good for you if rates are falling.

The following graph illustrates the trend for the COFI index to lag other indexes:

11th District COFI vs. 1-Year CMT and 6-Month LIBOR
11th District COFI vs. 1-Year CMT, 6-Month LIBOR, 1992-2014 
{ Obtaining Permission to Reproduce }

It should be noted that although COFI generally follows trends in market rates, it can move in an opposite direction over the near term (one of these periods is marked on the historical graph above).

The 11th District Cost Of Funds Index is the slowest moving and most stable of all ARM indexes. It smoothes out a lot of the volatility of the market.

The 11th District Cost of Funds index is one of the most popular ARM indexes. This index is primarily used for ARMs with monthly interest rate adjustments. Because this index generally reacts slowly in fluctuating markets, adjustments in your ARM interest rate will lag behind another market indicators. Many lenders believe COFI-indexed ARMs are some of the best deals available on the market today.

The COFI is one of the most widely used Option ARM indexes.

Historical Data: Mortgage-X compiles historical values for the indexes which are widely used on adjustable rate mortgages (ARMs). Click here for a history of the 11th District Cost Of Funds index. If you need historical data prior to 1990: History of Monthly COFI starting from January of 1979.

Note: The 11th District COFI is a 2-month lagging index: the index value for a particular month is not reported until the end of the next month.

Mortgage Professionals Offering COFI-indexed Loans: If you are looking for a COFI-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.

Note: Besides the 11th District Cost Of Funds index lenders may also use the other Cost Of Funds indexes, e.g. National Monthly Median Cost of Funds, Federal Cost of Funds.

Related Articles:

COFI-indexed ARMs And Their Advantages

COFI: Frequently Asked Questions

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