Mortgage Credit Availability Increases In July

Lending standards are loosening up – a signal of increased home affordability.

The Mortgage Bankers Association (MBA) released its Mortgage Credit Availability Index (MCAI) for July, which rose by 3.3% to 98.1.

The Conventional MCAI increased 6.4%, while the Government MCAI decreased 0.1%.

Of the component indices of the Conventional MCAI, the Jumbo MCAI increased by 9.3% and the Conforming MCAI rose 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,” MBA’s Vice President and Deputy Chief Economist Joel Kan commented. “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."