Mortgage Credit Availability Hit Highest Level in Three Months

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Mortgage credit availability increased 1.5% in May to a score of 180.6 on the Mortgage Bankers Association’s (MBA) Mortgage Credit Availability Index (MCAI).

Credit availability for conventional mortgages increased 2.0%, compared with the previous month, while credit availability for government loans increased 1.0%.

Of the conventional mortgages, credit availability for jumbo loans increased by 2.2% while credit for conforming loans increased by 1.9%.

“The expansion of offerings across all loan types drove credit availability to its highest level in three months,” says Joel Kan, associate vice president of economic and industry forecasting for the MBA, in a statement. “In particular, the conventional index and jumbo index both rose to their highest levels since March 2011. This was mainly caused by increased investor interest in jumbo loans and high balance conforming loans.”

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 index draws on data from Ellie Mae’s AllRegs Market Clarity business information tool.

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