The Mortgage Credit Availability Index (MCAI) came out of hibernation early this winter in February. Raising 0.7% to 118.6, the lending standards loosened which paved the way for improved credit availability, according to the Mortgage Bankers Association (MBA).
Flashback to March 2012, the MCAI was benchmarked at 100. With an increase to 118.6, lending standards are loosening. All of this was made possible with the surge of the Jumbo Mortgage Credit Availability Index and the upcoming Fannie Mae’s 97 LTV Program.
To recap the MCAI in full, February saw a slight rise in the Conventional MCAI and Government MCAI by 0.6%, a growth of 1.4% in the Jumbo MCAI, and a meager fall in the Conforming MCAI from 113.6 to 113.4.
Regardless of the Freddie Mac portion of the 97 percent conventional loan program still being weeks away, it still seemed to have an impact in the MCAI February summation. The MBA’s Chief Economist, Mike Fratantoni, stated that “Credit availability improved marginally in February, led by further increases in jumbo loan programs, and additional take-up of Fannie Mae’s 97 LTV program.” He also declared that “More than half of investors are now offering a 97 LTV program, and Freddie Mac announced that their program will be available in mid-March. In terms of conforming credit, this was offset by somewhat tighter constraints on cash-out loans and investors with multiple financed properties.”
With the 97 LTV Program getting more popular and Freddie Mac’s program being available in mid-March, the MCAI could get interesting this month. Stay tuned for what is sure to be another intriguing month.