The availability of conventional loans drove most of the increase, up 2.1% over the month. Availability of government-backed loans – inclusive Federal Housing Administration (FHA), The U.S. Department of Veterans Affairs (VA) and US Department of Agriculture (USDA) programs – increased 0.1%.
Within the conventional category, jumbo loan availability increased 2.9%, while conforming loan availability remained unchanged.
“Mortgage loan availability increased in January as lenders expanded their offerings of ARM loans, cash-out refinances and second home loans, most of which require lower LTV and higher credit scores,” said Joel Kan, MBA’s vice president and deputy chief economist.
“The beginning of the year is typically the time when lenders begin to position themselves for a pick-up in spring home purchases, and recent declines in mortgage rates have created refinancing opportunities, including refinancing into ARM loans.”
“The availability of jumbo loans increased by almost 3% during the month, with growth in the supply of both jumbo and non-QM loan programs,” Kan added.
The MCAI analyzes loan program data provided by ICE mortgage technology and is designed to track changes in credit standards over time. A falling index indicates tightening of credit conditions, while increases reflect an easing.
The MBA also publishes component indices to track specific market segments. The government index reflects FHA, VA and USDA programs, while the conventional index includes non-government loans. The jumbo and conforming indices are subsets of the conventional index, distinguishing between loans above and below the conforming loan limits.
#availability #mortgages #increases #January