The Mortgage Credit Availability Index (MCAI), a survey from the Mortgage Bankers Association (MBA), indicates that the availability of mortgage credit improved in March. Data shows that the MCAI increased by 1.1% to 108.3 last month amid rising home price growth. Lending rules are tightening when the MCAI declines, and loosening credit is indicated when the index rises. In March 2012, the index was benchmarked at 100.
While the Government MCAI rose by 1.7%, the Conventional MCAI increased by 0.6%. The Conforming MCAI climbed by 0.2%, while the Jumbo MCAI increased by 0.8% of the Conventional MCAI’s component indices.
Note: The MCAI is calculated using several factors related to borrower eligibility (credit score, loan type, loan-to-value ratio, etc.). These metrics and underwriting criteria for over 95 lenders/investors are combined by MBA using data made available via ICE Mortgage Technology and a proprietary formula derived by MBA to calculate the MCAI, a summary measure which indicates the availability of mortgage credit at a point in time.
“Credit availability increased modestly in March to its highest level since August 2022, with growth across all loan types. Despite the increase, overall credit supply is still closer to the lower end of its historical range,” said Joel Kan, MBA’s VP and Deputy Chief Economist. “Although March was volatile for mortgage rates and they moved higher over the month, there was growth in streamline refinance programs for lower credit score borrowers. Additionally, the jumbo index increased for the third consecutive month, driven by greater availability of non-QM loan programs.”
In March, the MCAI increased by 1.1% to 108.3. While the Government MCAI rose by 1.7%, the Conventional MCAI increased by 0.6%. The Conforming MCAI climbed by 0.2%, while the Jumbo MCAI increased by 0.8% of the Conventional MCAI’s component indices.
“Looking ahead, the outlook for the housing market remains cloudy,” according to Lisa Sturtevant, Chief Economist at Bright MLS. “While there had been promising signs that affordability was improving, higher rates and growing uncertainty are creating headwinds in the market. Even with cooler demand, home prices are likely to be stable this spring due to the ongoing supply shortfall. However, expect significant variation across markets, with stronger price appreciation in the Northeast and Midwest where inventory remains constrained, and slower price growth and price declines in markets in the South and West where inventory has climbed.”
Note: The MCAI provides the only standardized quantitative index that is solely focused on mortgage credit. Data prior to 3/31/2011 was generated using less frequent and less complete data measured at 6-month intervals interpolated in the months between for charting purposes.
