Tuesday, September 25, 2007
What is a COSI Mortgage?
 A COSI Mortgage is a mortgage on which a rate of interest is charged based upon an index known as the Cost of Savings Index. One of the largest Savings and Loans in the 11th District (CA, AZ, NV) offers a mortgage program tied to its own "cost of savings." Simply put, this Lender borrows money from consumers in the form of deposits, i.e. C/D's, checking and savings accounts, and then lends the money out as home mortgages. Then they place a fixed "Margin" on top of their own Index. The interest rates in effect on these deposits are the basis for the COSI. The COSI is not based on actual interest paid on deposit accounts, but rather on a weighted annualized rate of all interest rates in effect on deposit accounts as of the last day of each month. |
COSI Mortgage is cost of savings Index.COSI Mortgage index will differ from month to month for each year.
The COSI mortgage interest will be determined by monthly adjustable rate concept to determine the actual rate of interest charged.
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