Mortgage credit availability increased in July, rising 3.3% compared with June to a score of 98.1 on the Mortgage Bankers Association’s (MBA) Mortgage Credit Availability Index (MCAI).
A decrease 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.
Credit availability for conventional loans increased 6.4% compared with June, while credit availability for government loans decreased by 0.1%.
Within conventional category, credit availability for jumbo loans increased by 9.3% while credit availability for conforming loans increased by 0.7%.
“Overall credit availability grew to its highest level since October 2023, driven by increased conventional loan offerings such as ARMs and cash-out refinance loans,” says Joel Kan, vice president and deputy chief economist for the MBA, in a release. “We also saw credit supply expand for jumbo loans, particularly in the non-QM space. Industry capacity has been low for some time, but we have now seen more than six months of credit expansion, which should be supportive for homebuyers and refinance borrowers, as rates have declined in recent weeks.”
Photo: Giorgio Trovato