Cost Of Savings Index - COSI Index
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Definition of 'Cost Of Savings Index - COSI Index'
A popular index used for certain adjustable-rate mortgages (ARMs). The index is a weighted average of the rates of interest on the deposit accounts (sometimes called cost of savings) of the federally insured depository institution subsidiaries of Golden West Financial Corporation (GDW). These subsidiaries currently operate under the name World Savings.
GDW computes the COSI on the last day of each calendar month and announces it on or near the last business day prior to the fifteenth day of the following calendar month.
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Investopedia explains 'Cost Of Savings Index - COSI Index'
The COSI index is a stable index. Historically, it is not as volatile as some other popular mortgage indexes, such as the one-month LIBOR index. It also tends to lag other mortgage indexes when it comes to adjusting to changes in interest rates.
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Both of these have advantages and disadvantages depending on your financial needs and prospects.
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In a climate of rising interest rates, having an adjustable-rate mortgage can be risky.
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Search and compare the best fixed and adjustable mortgage rates in your area with Bankrate.com.
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