Mortgage Credit Availability Increased in June
(Courtesy of Mortgage Bankers Association; Powered by ICE Mortgage Technology)
Mortgage credit availability increased in June according to the Mortgage Credit Availability Index, a report from the Mortgage Bankers Association that analyzes data from ICE Mortgage Technology.
The MCAI rose by 0.1% to 96.6 in June. 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. The Conventional MCAI was unchanged, while the Government MCAI was essentially unchanged. Of the component indices of the Conventional MCAI, the Jumbo MCAI decreased by 0.2%, and the Conforming MCAI rose by 0.2%.
“Mortgage credit availability was essentially unchanged in June, remaining close to the lowest level since early 2013, as the industry continues to operate at reduced capacity,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Lenders are streamlining their operations by offering fewer loan programs, with some exiting certain channels. Data from our Weekly Applications Survey indicated that June mortgage applications were more than 30% lower than a year ago and at the slowest pace since December 2022.”
Added Kan, “The Jumbo Index declined slightly by 0.2%–the second straight monthly decrease–as liquidity conditions have been tightening for jumbo lending.”
The MCAI analyzes data from ICE Mortgage Technology. 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, 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.
