MBA: Mortgage Credit Availability Down Again in December

Mortgage credit availability fell in December for the second straight month, the Mortgage Bankers Association reported this morning.  

The MBA Mortgage Credit Availability Index, which analyzes data from Ellie Mae’s AllRegs Market Clarity business information tool, fell by 2.4 percent to 124.3 in December. Of the four component indices, the Conventional MCAI saw the greatest tightening (down 4.8 percent) over the month followed by the Jumbo MCAI (down 4.2 percent), and the Government MCAI (down 0.6 percent). The Conforming MCAI increased by 0.1 percent over the month.  

A decline in the MCAI indicates that lending standards are tightening, while increases in the index are indicative of loosening credit. The index was benchmarked to 100 in March 2012.  

MBA Vice President of Research and Economics Lynn Fisher noted, however, while a decline to the index is generally indicative of tightening lending standards, other factors came into play in December.  

“This month, a large part of the decline was driven by a technical issue related to implementation of affordable, low down payment, loan programs, Fisher said. “Many investors discontinued existing low down payment loan programs only to replace them with new iterations of similar programs that were discontinued. This introduced volatility into the December index reading and magnified the decline we saw over the month.”  

Fisher said conceptually, underwriting changes that caused these issues represent an expansion of the credit and are targeted at low-to-moderate income borrowers and first time homebuyers. “A similar issue also caused changes to jumbo loan programs and had a tightening effect on the index while changes to government lending programs–FHA and VA–had an upward/loosening impact,” she said.  

MBA reports on five total measures of credit availability as part of the monthly MCAI release: the Total Mortgage Credit Availability Index; the Conventional Mortgage Credit Availability Index; the Government Mortgage Credit Availability Index; the Conforming Mortgage Credit Availability Index; and the Jumbo Mortgage Credit Availability Index, with historical data back to 2011.  

The Conventional, Government, Conforming and Jumbo MCAIs are constructed using the same methodology as the Total MCAI and are designed to show relative credit risk/availability for their respective index. The primary difference between the total MCAI and the Component Indices are the population of loan programs which they examine. The Government MCAI examines FHA/VA/USDA loan programs, while the Conventional MCAI examines non-government loan programs. Similarly, the Jumbo MCAI examines everything flagged as “Jumbo” while the Conforming MCAI examines loan programs that fall under conforming loan limits.  

The Conforming and Jumbo indices have the same “base levels” as the Total MCAI (March 2012=100), while the Conventional and Government indices have adjusted “base levels” in March 2012. Using data from the MCAI and the Weekly Applications Survey, MBA calibrated the Conventional and Government indices to better represent where each index might fall in March 2012 (the “base period”) relative to the Total=100 benchmark.  

Expanded Historical Series

The Total MCAI has an expanded historical series, which gives perspective on credit availability going back 10-years (expanded historical series does not include Conventional, Government, Conforming or Jumbo MCAI). The expanded historical series covers 2004 through 2010 and was created to provide historical context to the current series by showing how credit availability has changed over the past 10 years, including the housing crisis and ensuing recession. Data prior to March 31, 2011 was generated using less frequent and less complete data measured at six-month intervals and interpolated in the months between for charting purposes.  

About the MCAI

The MCAI provides the only standardized quantitative index solely focused on mortgage credit. The MCAI is calculated using several factors related to borrower eligibility (credit score, loan type, loan-to-value ratio, etc.). These metrics and underwriting criteria for more than 85 lenders/investors are combined by MBA using data made available via the Ellie Mae AllRegs Market Clarity product and a proprietary formula derived by MBA to calculate the MCAI, a summary measure which indicates the availability of mortgage credit at a point in time. Base period and value for all indexes is March 31, 2012=100.  

To learn more about the Ellie Mae AllRegs Market Clarity platform visit For more information on the Mortgage Credit Availability Index, including Methodology, Frequently Asked Questions and other helpful resources, visit or contact