The West Coast index for adjustable rate mortgages continued its ascension during February.
The cost of funds index, or COFI, increased to 2.317% in February, up from 2.183% the prior month, the Federal Home Loan Bank of San Francisco reported yesterday. The index, which is calculated from the interest expense of member banks in Arizona, California, and Nevada, was just 1.841% a year ago.
The average total funds used in COFI, which is reported on a one-month lag, was $511.5 billion in February.
The index has not been this high since December 2002 -- when the average was 2.375%.
ARMs represent a record 37% of all applications, according to the latest Mortgage Bankers Association survey.
The 1-year Treasury bill, used as the index in the most popular ARM, was recently reported at 3.38%.