|Just when it appeared that the Cost of Funds Index couldn't go any lower, it sank to its lowest level on record.
Tumbling 0.376 percent from February, COFI was 1.627 percent in March, the Federal Home Loan Bank of San Francisco reported today. A year earlier, the index stood at 3.280 percent.
Eleventh District data going back to July 1981 -- the oldest available -- indicated that COFI has never been this low.
The FHLB determines COFI based on the interest expenses of its member institutions headquartered in Arizona, California and Nevada.
Average total funds used in March's calculation were $97.9 billion, up from $84 billion in February.
Like COFI, the yield on the one-year Treasury is used as an index for adjustable-rate mortgages. The one-year ended March at 0.57 percent, falling from February's 0.72 percent.
The one-year Treasury yield ended this month at 0.49 percent.
Bankrate.com reported that the six-month London Interbank Offered Rate, which is used as an index for many subprime ARMS, was 1.77 percent at the end of March, higher than 1.75% at the end of February.
LIBOR ended this month at 1.58 percent.
The Mortgage Bankers Association reported yesterday that the ARM share of loan applications in its latest weekly survey was 2.1 percent in its latest weekly survey.