Talking Points …
- The availability of mortgage credit declined in August, according to the Mortgage Credit Availability Index (MCAI), a report from the Mortgage Bankers Association (MBA). Decreases in availability of loans that have an interest-only feature are attributed to the MCAI’s drop.
- During August, the MCAI decreased 0.7 percent to 111.5. This is the first drop following four consecutive months of increases. Such a decrease in the index is indicative of lending standards tightening.
- The MCAI is calculated using several factors related to borrower eligibility (credit score, loan type, loan-to-value ratio, etc.). August’s index reflects a reduction in the availability of certain loan features, particularly interest-only and terms exceeding 30 years.