April Mortgage Credit Availability Up 2.2%

Mortgage credit availability increased in April, the Mortgage Bankers Association reported this morning.

The MBA Mortgage Credit Availability Index, which analyzes data from ICE Mortgage Technology’s AllRegs Market Clarity business information tool, .

The MCAI rose by 2.2 percent to 128.1 in April. The Conventional MCAI increased by 4.8 percent, while the Government MCAI increased by 0.1 percent. Of the component indices of the Conventional MCAI, the Jumbo MCAI increased by 6.9 percent and the Conforming MCAI rose by 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,” said Joel Kan, MBA Associate Vice President of Economic and Industry Forecasting. “The uptick in credit supply comes as the housing market and economy continue to strengthen. 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 appreciation.” 

Kan noted, however, despite the April increase, “mortgage credit supply has not returned to pre-pandemic levels, given the over 2 million loans still in forbearance.”

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.

About the Mortgage Credit Availability Index

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 95 lenders/investors are combined by MBA using data made available via the 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 values for total index is March 31, 2012=100; Conventional March 31, 2012=73.5; Government March 31, 2012=183.5.

To learn more about the ICE Mortgage Technology AllRegs Market Clarity platform, visit http://answers.allregs.com/MCAI-Market-Clarity. For more information on the Mortgage Credit Availability Index, including Methodology, Frequently Asked Questions and other helpful resources, visit www.mba.org/MortgageCredit or contact MBAResearch@mba.org.