Mortgage Credit Tightens In September

Mortgage rates remain at record lows, but mortgage credit keeps getting harder and harder to obtain. The Mortgage Bankers Association reports that mortgage credit availability decreased in yet again in September, reaching the lowest level since February 2014 and down roughly 50 percent this year. The Mortgage Credit Availability Index (MCAI) fell 1.9 percent 118.6 in September, with the conventional loan MCAI decreasing 6.1 percent and the government MCA increased by 1.4 percent. The jumbo MCAI decreased by 2.1 percent and conforming MCAI fell by 9.5 percent. “Across all loan types, there continues to be fewer low credit score and high-LTV loan programs,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting.  “The housing market overall is on…

Credit Availability At Lowest Level In 6 Years

Low rates, scarce credit. With mortgage rates at historically low levels, mortgage credit availability in the United States decreased even further in June, according to a report released Thursday by the Mortgage Bankers Association. MBA’s Mortgage Credit Availability Index fell by 3.3 percent to 125 in June – reflecting a 30 percent drop in credit availability since February, the month before the coronavirus pandemic gripped the nation. The index reached its lowest level since April 2014. “Mortgage credit supply dropped again in June, as investors further reduced their willingness to purchase jumbo loans and those with lower credit scores. Lenders are navigating a gradual economic and housing market recovery that is still facing headwinds from the ongoing COVID-19 pandemic,” said…

Mortgage Credit Availability Down 32% Since November

Mortgage credit keeps getting tighter, but the decrease in credit availability leveled off in May, the Mortgage Bankers Association reported Tuesday. May marked the sixth straight month that saw mortgage credit tighten, falling 3.1 percent in the month. Mortgage credit availability has decreased by nearly 32 percent over the last six months, according to MBA’s Mortgage Credit Availability Index (MCAI). The MCAI fell to 129.3 in May. 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.  “Mortgage lenders in May responded accordingly to the increased risk and uncertainty in the economy,” said Joel Kan, MBA’s Associate Vice President of…

Credit Tightens Further As Rates At Record Lows

By Jim Perskie Economic difficulties caused by the coronavirus are making it harder for borrowers to obtain mortgage credit, even as interest rates have plunged to historic lows. The Mortgage Bankers Association announced Thursday that the Mortgage Credit Availability Index (MCAI) dropped 12.2 percent in April, reflecting a tightening of the lending standards in the market. “The abrupt weakening of the economy and job market – and the uncertainty in the outlook – drove credit availability down in April for the second consecutive month,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “The overall index fell to its lowest level since December 2014, and the sub-indexes pointed to tightened credit supply for all loan types. The…