Mortgage credit availability decreased slightly in November according to the Mortgage Credit Availability Index (MCAI), a report from the Mortgage Bankers Association (MBA) which analyzes data from the AllRegs Market Clarity product.
The MCAI decreased 1.2 percent from 111.5 in October to 110.2 in November. A decline in the MCAI indicates that lending standards are tightening, while increases in the index are indicative of a loosening of credit. The index was benchmarked to 100 in March 2012. If it had been tracked in 2007, it would have been at a level of roughly 800, indicating the credit was much more available at that time.
A significant number of loan programs allowing for more than 95 LTV and low-to-mid range minimum FICOs were either discontinued in November, or transitioned into programs with lower LTV maximums and/or higher minimum credit scores. Investor pull-back from programs with greater than 30 year terms and Interest-Only programs continued as the industry prepares for new regulations coming into effect in January 2014.
Some decreases to the index were offset by investors increasing their cash-out offerings to well-qualified borrowers.