Access to government
loans continues to decline, but conventional and jumbo loans picked up the
slack in October, pushing the Mortgage Credit Availability Index (MCAI)
higher. The Mortgage Bankers Association
(MBA) said the Index grew by 0.9 percent to 185.1 in October. A decline in the
MCAI indicates that lending standards are tightening, while increases in the
index are indicative of loosening credit.

"Mortgage credit
availability expanded in October, driven mainly by an increase in
conventional loan programs, including more for borrowers with lower credit
scores, as well as for investors and second home loans," said Joel Kan, MBA's
Associate Vice President of Economic and Industry Forecasting. "Credit supply
for government mortgages continued to lag, declining for the sixth straight
month. Meanwhile, the jumbo credit index increased 3 percent to another
survey-high, as that segment of the market stays resilient despite signs of a
slowing economy."
The MCAI has four components specific to loan types.
The Conventional MCAI increased 2.4 percent, while the Government MCAI
decreased by 0.9 percent. Of the component indices of the Conventional MCAI,
the Jumbo MCAI increased by 3.1 percent, and the Conforming MCAI rose by 1.3
percent.
The MCAI is calculated using several factors related
to borrower eligibility (credit score, loan type, loan-to-value ratio, etc.)
gathered from over 95 lenders and investors. These are combined with data from
Ellie Mae's AllRegs proprietary product to calculate a summary measure
indicating the availability of mortgage credit at a point in time
The MCAI and its components were benchmarked in
March 2012 and are designed to show relative credit risk/availability for their
respective indices. The Conforming, and Jumbo sub-indices were indexed at 100
while the Conventional and Government indices were indexed at 73.5 and 183.5
respectively to better represent where each index might have been relative to 100.