Question:

What are the best features of a COFI Option ARM?

Answer:

A COFI Option ARM is a common Option ARM. Unlike LIBOR ARMs which do not allow negative amortization, COFI Option ARMs are typical Option ARMs and deferred interest is a payment option, leading to negative amortization.

A COFI Option ARM will have less fluctuating rates than other Option ARMs. Since the COFI index is a little extraordinary, compared to other ARM rates following market conditions, COFI Option ARM are less predictable but more stable.

The Best About COFI Option ARMs

Those Option ARMs will have better protection for customers when the market trend favors rising rates. COFI is a slow changing index and borrowers taking a COFI Option ARM are less likely to suffer huge payment shock. However, the COFI ARM rates will not be the lowest, when rates are falling - much for the same reason.

However, COFI ARMs may have the lowest margins on the market and some lenders clearly have stated their appreciation for particular COFI ARMs as the best product in their target niche.

Recommended helpful present and future homeowners links:
Why: Refinance to a fixed rate loan while mortgage rates are still low.
Link:
Why: Because FHA loans are insured by the US Federal Government they have very competitive interest rates and are easier to qualify.
Link:
Why: Know and protect your credit report and score.
Link: See All 3 National Credit Scores & 3 Reports Instantly, Online & Free
Why: Find your next home and save money.
Link: Search thousands of foreclosures. Free 7-day trial.
Link this QnA Print del.icio.us Digg
Was this Mortgage QnA helpful?
Not at all
  • Currently 3/5 Stars
  • 1
  • 2
  • 3
  • 4
  • 5
 Definitely
Add to this Answer

Mortgage QnA is not a common forum. We have special rules:

  • Post no questions here. To ask a question, click the Ask a Question link
  • We will not publish answers that include any form of advertising
  • Add your answer only if it will contrubute to the quality of this Mortgage QnA and help future readers
If you have trouble reading the code, click on the code itself to generate a new random code. Verification Code Above:
Bookmark and share this QnA:

Common misspellings: mortage and morgage