Mortgage credit availability in the US decreased in June according to the Mortgage Credit Availability Index (MCAI) by the Mortgage Bankers Association. The index uses data from Ellie Mae’s AllRegs Market Clarity business information tool.
The MCAI fell by 3.3% to 125.0 in June, with the decline indicating that lending standards are tightening and increases indicative of loosening credit.
The MCAI is a standardised quantitive index that is solely focused on mortgage credit, and is calculated using several factors related to borrow eligibility.
As part of the index, there is an expanded historical series that provides insight on credit availability for the past 10 years. The series was created in order to show how credit availability has changed over the past 10 years during events such as the housing crisis and recession.
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Source: Mortgage Bankers Association; Powered by Ellie Mae’s AllRegs® Market Clarity® Data prior to 3/31/2011 was generated using less frequent and less complete data measured at 6-month intervals interpolated in the months between for charting purposes.
Joel Kan, associate vice president of economic and industry forecasting at the Mortgage Bankers Association, said: “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. The overall credit availability index decreased 3.3% to its lowest level since April 2014, with all of the sub-indexes falling to lows not seen since 2014-2015.
“Credit supply has fallen over 30% since February – before the pandemic – with an 18% decrease in government loan availability, and a 57% drop in jumbo loan availability.”
