COFI Index, COFI Loans
The Cost of Funds Index (COFI) is used as a benchmark for some types of mortgage loans and securities. There are two popular COFI indexes:
- 11th District cost-of-funds index (COFI) is the weighted-average interest rate paid by 11th Federal Home Loan Bank District savings institutions for savings and checking accounts. The 11th district covers Arizona, California and Nevada. The index is published on the last day of the month and reflects the cost of funds for the prior month.
- Federal COFI Index is calculated as the sum of the monthly average interest rates for marketable Treasury bills and for marketable Treasury notes, divided by two, and rounded to three decimal places. The Federal COFI is not adjusted to reflect subsequent changes in the underlying Treasury rates once the value has been posted.
COFI Based ARM Mortgages
For many, your mortgage payment is your largest monthly expense, and the least flexible. Many COFI Loans are designed to give greater control over your mortgage payment (Flex-payment loans). You can choose one of three-four payment options monthly based on your specific cash flow needs. some people call the COFI loan 1.5%, 2.5% etc. loan due to very low introductionary rate.
- The minimum payment is a payment that is set for 12 or 60 months at a greatly reduced rate. This option not only maximizes cash flow but may also defer payment of interest on your mortgage allowing greater flexibility in managing your tax deductions.
- The interest only payment allows you to defer paying the principal on your loan and improve your monthly cash flow. Your cash flow is improved by the money you save.
- With fully amortizing payment options, you have the ability to make a principal and interest payment based on either a 30 year or 15 year payment schedule.
Your first step should be to run the numbers on our web site to get an idea about COFI and other ARM loans, quote rates and closing costs. Then, use our network of lenders and expert mortgage specialists to find the best loan for your property.