U.S. Mortgage Credit Availability Dips in September

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The MBA's latest Mortgage Credit Availability Index (MCAI) fell by 1.9 percent to 118.6 in September. 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 Conventional MCAI decreased 6.1 percent, while the Government MCAI increased by 1.4 percent. Of the component indices of the Conventional MCAI, the Jumbo MCAI decreased by 2.1 percent, and the Conforming MCAI fell by 9.5 percent.

"Mortgage credit supply decreased in September to its lowest level since February 2014, driven in part by a 9.5 percent decline in the conforming loan segment. This reduction was the result of lenders discontinuing conforming ARM loan offerings in advance of the September 30, 2020, application deadline for GSE-eligible, LIBOR-indexed ARM loans," said Joel Kan, MBA's Associate Vice President of Economic and Industry Forecasting. "Across all loan types, there continues to be fewer low credit score and high-LTV loan programs. The housing market overall is on strong footing, but the data show that lenders are being cautious, given the spike in mortgage delinquency rates in the second quarter, as well as the ongoing economic uncertainty."