According to the latest Mortgage Credit Availability Index, a report from the Mortgage Bankers Association that analyzes data from ICE Mortgage Technology, U.S. mortgage credit availability increased in March 2023.
The MCAI rose by 0.4 percent to 100.5 in March. A decline in the MCAI indicates that lending standards are tightening, while increases in the index are indicative of loosening credit. The index was benchmarked to 100 in March 2012. The Conventional MCAI increased 1.1 percent, while the Government MCAI decreased by 0.2 percent. Of the component indices of the Conventional MCAI, the Jumbo MCAI increased by 1.4 percent, and the Conforming MCAI rose by 0.4 percent.
"Mortgage credit supply increased modestly in March but remained close to its tightest levels since 2013. With the spring buying season underway, lenders are grappling with the threat of a recession and tighter overall financial conditions following the recent bank failures," said Joel Kan, MBA's Vice President and Deputy Chief Economist. "The supply of government mortgage credit - which includes FHA and VA loans that many first-time homebuyers rely on - declined for the third time in four months, which could potentially hinder first-time buyer activity. There was a small increase in credit availability for jumbo loans, with more programs offered for cash-out refinances. However, we expect banks, which account for most of the jumbo market, will tighten jumbo credit criteria in response to recent challenges in the banking sector."