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| 11th District Cost of Funds |
| By Bankrate.com |
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| Prime rate, fed funds, COFI |
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This week |
Month ago |
Year ago |
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11th District Cost of Funds
|
2.918 |
3.111 |
4.293 |
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What it means:
A monthly cost-of-funds index (COFI) reflecting 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.
How it's used:
It’s an index that is used to set the cost of variable-rate loans,
such as an adjustable-rate mortgage. Lenders use such an index, which
varies, to adjust interest rates as economic conditions change. They
then add a certain number of percentage points called a margin, which
doesn’t vary, to the index to establish the interest rate you must
pay. When this index goes up, interest rates on any loans tied to
it also go up. COFI usually lags market interest rates in both up
and down markets. That means loans tied to this index rise and fall
more slowly than rates in general.
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