It’s been 10 months since the Cost of Funds Index was as high as it was last month. Another adjustable-rate mortgage index moved lower.
The 11th District COFI
was 0.698 percent in January, according to the Federal Home Loan Bank of San Francisco.
The last time the index, which is used to determine changes to some ARMs, was this high was in March 2014, when it came in at 0.701 percent.
In December 2014, COFI was 0.692 percent.
The index has retreated from January 2014, when it was reported at 0.768 percent.
The FHLB determines COFI based on the interest expense of FHLB-members with headquarters in Arizona, California and Nevada.
Average total funds used in January’s calculation were $16.1 billion.
A more traditional ARM is the one-year Treasury-indexed ARM, which adjusts based on the one-year Treasury yield. The one-year yield
fell from 0.25 percent as of the end of December to 0.18 percent at the end of January, according to Treasury Department data.
As of the end of February, however, the one-year yield
had risen back up to 0.22 percent.
ARMs accounted for 8.9 percent of all product-and-pricing inquiries tracked for the Mortgage Market Index report for the week ended Feb. 27. ARM share widened from 8.6 percent the previous week.
