Mortgage Credit Availability Increases for Second Consecutive Month in September

The Mortgage Bankers Association (MBA) on Tuesday (10-10-23) released its Mortgage Credit Availability Index (MCAI) report for September. According to the MCAI, which analyzes data from ICE Mortgage Technology, mortgage credit availability increased in September.

The MCAI increased 0.6% to a reading of 97.2 in September. The MBA notes that a decline in the MCAI indicates that lending standards are tightening, while an increase is indicative of loosening credit. The index was benchmarked to 100 in March 2012.

The Conventional MCAI increased 0.6%, and the Government MCAI also increased by 0.6%. Of the component indices the Conventional MCAI, the Jumbo MCAI rose 0.8%, and the Conforming MCAI increased 0.2%.

Additional background and his analysis to the September MCAI, MBA Vice President and Deputy Chief Economist Joel Kan said:

“Credit availability increased slightly in September, as lenders increased their loan offerings marginally to meet the changing needs of borrowers who are facing higher mortgage rates. There were more loan programs for ARM loans for borrowers seeking lower initial monthly payments and also some increases in non-QM product offerings. Credit availability increased across all loan categories, with the jumbo index increasing for the second straight month, driven by the expansion of ARM and non-QM offerings.

Industry capacity has declined significantly since the peak originations months in 2021, and MBA expects to see further declines in originations volume, given the high interest rate environment and typical seasonal slowdown.”