Mortgage credit availability decreased 0.1% in January and remained at the lowest level since 2013, according to the Mortgage Bankers Association’s (MBA) Mortgage Credit Availability Index (MCAI).
Credit availability for conventional loans decreased 0.3%, while credit availability for government-backed mortgages remained unchanged.
Credit availability for jumbo loans decreased by 0.4%, while credit availability conforming loans was flat compared with the previous month.
“Similar to December 2022, the availability of credit has been driven lower by declining originations and shrinking industry capacity as lenders have streamlined their operations to cope with lower volumes,” says Joel Kan, Vice President and Deputy Chief Economist for the MBA, in a statement. “Additionally, as mortgage rates declined over the past month, the share of adjustable-rate mortgages has fallen – consistent with a slight pullback in ARM offerings in this month’s results.
“However, there has been a revival in mortgage application activity over the past month and our forecast is for rates to continue to decline and housing activity – including home sales and new home construction – to gradually pick up as we approach the spring homebuying season,” Kan adds. “These developments could potentially change the credit availability landscape in the months ahead.”
“Credit” by 401(K) 2013 is licensed under CC BY-SA 2.0.