Although there are several cost of funds indexes (COFI) published, the most widely used is a monthly index published by the Federal Home Loan Bank of San Francisco (FHLBSF).  This index is called the 11th District Monthly Weighted Average Cost of Funds Index or COFI for short.  This index is one of several indices (such as the LIBOR index and the MTA) used by mortgage lenders to set the floating interest rate on adjustable rate mortgages.  The COFI index reflects the average rate of interest paid for funding by savings & loan institutions in the 11th District.  One of the most popular home loan programs based on the COFI index is the Option Arm.  This loan provides a number of payment options each month ranging from a minimum payment to the full principal and interest payment.