|The cost of funds index fell to its lowest level in nearly four years.
COFI tumbled to 2.455% during January from 2.757% in December, the Federal Home Loan Bank of San Francisco reported today. A year ago, the index was 3.970%.
The last time COFI was this low was in March 2005, when it stood at 2.400%.
COFI, which is used an index for adjustable-rate mortgages, was calculated based on the interest expense of 11th district members headquartered in Arizona, California and Nevada.
The FHBL determined January's index using $82.0 billion in average total funds.
Another ARM index, the one-year Treasury yield, ended January at 0.51%, up from 0.37% on Dec. 31, 2008, according to data reported by the U.S. Department of the Treasury. The one-year yielded 0.72% at today's close.
The London Interbank Offered Rate -- or LIBOR -- was 1.68% at the end of January, falling from 1.78% at the end of December. LIBOR was 1.75% on Wednesday.
ARMs accounted for 2% of applications tracked in the latest weekly survey from the Mortgage Bankers Association.