203K, VA, and Jumbos Help Credit Availability in April

Incremental increases in credit access continued in April according to the Mortgage Bankers Association's Credit Availability Index (MCAI).  The Index increased 0.5 percent month-over-month to 122.0 in April, an increase that indicates a loosening of credit.  A decline indicates that credit standards are tightening.

"Mortgage credit availability increased on net in April," said Mike Fratantoni, MBA's Chief Economist. "The increase was driven by new offerings of FHA's 203K home improvement program, new VA offerings, and new jumbo products.  The increase was partially offset by some investors tightening underwriting criteria on conventional cash out offerings."  

Three of the four MCAI component indices rose during the month as well with the largest change, +1.1 percent, in the Government MCAI.  The Jumbo was up 0.8 percent and the Conforming gained 0.2 percent.  The Conventional MCAI lost 0.6 percent.

The MCAI and its four components are designed to show relative credit risk/availability based on information about borrower eligibility and underwriting criteria gathered for over 95 lenders and investors and combined with data from Ellie Mae's AllRegs Market Clarity product.  The MCAI was benchmarked to 100 in March 2012.  Base period and values for the components vary.