Delaware Mortgage Loans

A bank receives money from consumers in the form of deposits, and then lends money as home mortgages or other loans. The interest rates in effect on these deposits are the basis for the COSI index. It is not based on actual interest paid, but rather the weighted annualized average of all interest rates in effect on deposit accounts on the last day of each month.

Similar to the Cost of Savings Index above, this index is based on an average of the 12 most recent monthly yields on 3-month certificates of deposit (CDs).

Summary:
Both the CODI and the COSI index are specific to one lending institution, World Savings, and both average higher than the more universally used index, the MTA. The biggest challenge associated with these indexes is that the institution controls the margin on top of the loan, and this margin is normally higher than most other ARM margins by comparison. The product and indexes are good for niche product usage for somewhat easier qualification for a customer with unique needs such as NIV type loans or mildly credit challenged files.

Ideally Suited for:
These indexes are ideally suited for a slightly to more difficult type loan file with credit, income or even reserve requirements being somewhat below standard guidelines. In comparisons over time, these indexes appear to be more expensive than more readily used ARM indexes previously discussed. The good news is that presented properly, this option can still be less expensive for your borrower than a sub-prime type product, if they have borderline credit.