For the third consecutive month, the Cost of Funds Index fell to a record low. Other adjustable-rate mortgage indices haven’t fared so well.
COFI, which is used to determine rate and payment changes on a small share of ARMs, was
0.639 percent in August.
Based on the oldest available data for COFI going back to
July 1981, the index currently stands at it lowest point on record.
COFI was reported Wednesday by the Federal Home Loan Bank of San Francisco.
A month earlier, the 11th District index stood at 0.643 percent — the second consecutive month it reached an all-time low.
It was 0.667 percent a year earlier — also the lowest level on record at the time.
COFI was computed based on the interest expense of 11 FHLB-member banks based in Arizona, California and Nevada.
Average total funds used in the August calculation was
$17.1 billion.
Another ARM index, the six-month London Interbank Offered Rate, climbed to 0.52 percent at August’s close from 0.47 percent as of the end of July, Bankrate.com reported.
LIBOR inched up another basis point to 0.53 percent as of Sept. 30.
A far more widely utilized ARM index is the yield on the one-year Treasury note, which finished August at 0.39 percent, climbing from 0.33 percent at the end of July, according to data from the Department of the Treasury.
However,
the one-year Treasury yield has since retreated, falling back to 0.33 percent as of the end of September.
In the U.S. Mortgage Market Index report from Mortgage Daily and OpenClose for the week ended Sept. 25, ARM share was 10.5 percent.
