Mortgage credit availability increased 2.9% in July to reach an index score of 125.5 in the Mortgage Bankers Association's (MBA) monthly Mortgage Credit Availability Index (MCAI) report.
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.
The MCAI includes four component indices: the Conventional MCAI, which was up 5.2% in July compared to June, followed by the Jumbo MCAI, which was up 4.7%, the Government MCAI, which was up 0.9%, and the Conforming MCAI, which was up 0.4%.
‘Credit availability increased in July, mainly driven by higher-balance loan programs,’ says Mike Fratantoni, chief economist for the MBA, in a release. ‘Many investors are fine-tuning their cash-out refinance requirements to meet increasing borrower demand for home equity financing. Some investors increased the availability of low down payment loans.’
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