Access to mortgage financing improved in
April, driven by a large gain in the availability of both conforming and jumbo
mortgages. The Mortgage Bankers Association (MBA) said its Mortgage Credit
Availability Index (MCAI) rose 2.2 percent to 128.1 during the month. An
increase in the MCAI indicates that lending standards are loosening.
The Conventional MCAI increased 4.8 percent,
while the Government MCAI ticked up by 0.1 percent. Of the component indices of
the Conventional MCAI, the Jumbo MCAI increased 6.9 percent, and the Conforming
MCAI rose 12.6 percent.
“Credit availability rose in April, fueled by a
5 percent increase in conventional mortgage credit, as well as an expansion in
agency programs for ARMs and high-balance loans. The conforming and jumbo loan
indices jumped 7 percent and 13 percent, respectively. The uptick in credit
supply comes as the housing market and economy continue to strengthen,” said
Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting.
“One trend that has developed in recent months is the rising demand for ARMs,
driven by higher rates for fixed mortgages and faster home-price
Added Kan, “Despite this month’s increase,
mortgage credit supply has not returned to pre-pandemic levels, given the over
2 million loans still in forbearance.”
The MCAI and each of its components are calculated
using several factors related to borrower eligibility (credit score, loan type,
loan-to-value ratio, etc.). These metrics and underwriting criteria for over 95
lenders/investors are combined by MBA using data made available via a
proprietary product from Ellie Mae. The resulting calculations are summary
measures which indicate the availability of mortgage credit at a point in time.
Base period and values for the total index is March 31, 2012=100; Conventional,
March 31, 2012=73.5; Government, March 31, 2012=183.5.