Cash-Out Loans Help Mortgage Credit Availability Improve

ThernMortgage Bankers Association’s new Mortgage Credit Availability Indexrn(MCAI) increased in June to 112.3 from 108.9 in May, an increase ofrn2.2 percent. This was the fifth consecutive increase in the indexrnwhich was publicly released for the first time in June. </p

Usingrndata from AllRegs MarketrnClarity® product.and data on borrower eligibility (credit score,rnloan type, loan-to-value ratios, etc), underwriting criteria for overrn85 lenders and investors, MBA produces a single monthly index numberrnto capure how the availability of mortgage credit fluctuates fromrnmonth to month. The lower the number compared to thernbase of 100 set in March 2012, the less available credit it presumedrnto be. By way of comparison,rnMBA said had the index existed in 2007 the MCAI would have beenrnroughly 800.</p

MBArnsays the increase in the MCAI in July wasrnprimarily driven by increases in product offerings that allowrncash-out refinancing, and some increase in offerings for borrowersrnwith higher loan-to-value ratios or lower credit scores.

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