Lenders offer more jumbo loan options as credit standards ease slightly

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Access to jumbo mortgages rose nearly 6 percent in September, pushing the Mortgage Bankers Association’s (MBA) Mortgage Availability Index (MCAI) higher for the third consecutive month.The index rose 1.5% to 125.6, its highest level since May. An increase in the index indicates an easing of credit standards. The index was benchmarked at 100 in March 2012.

Conventional MCAI increased 4.5 percent, while government MCAI decreased 0.7 percent. Among the constituent indices of conventional MCAI, Jumbo MCAI was 5.8% higher and Conforming MCAI 2.6%.

Joel Kan, associate vice president of economic and industrial forecasting at the MBA, said: “Last month’s expansion was driven by a 4.5% increase in the conventional index, while the government index edged down. decreases. Even with increases in seven out of nine months so far in 2021., total credit availability is still around 30% lower than it was in February 2020 before the pandemic. “

Kan added, “We are still seeing high rates of home price appreciation and lenders are responding by offering a wider range of loans to accommodate qualified buyers. Jumbo credit availability increased nearly 6% to its highest level since March 2020, with more loan programs. for non-QM jumbos and loans intended for independent borrowers or those with non-traditional sources of income. Even though mortgage rates continue to rise,
Withdrawal refinances remain an option for borrowers who have sufficient home equity and need additional cash flow. ”

The MCAI and each of its components are calculated using several factors related to the borrower’s eligibility (credit rating, type of loan, loan-to-value ratio, etc.). These underwriting metrics and criteria for over 95 lenders / investors are combined by MBA using data made available through an Ellie Mae proprietary product. The resulting calculations are summary measures that indicate the availability of mortgage credit at any given time. The base period and the total index values ​​are March 31, 2012 = 100; Conventional March 31, 2012 = 73.5; Government March 31, 2012 = 183.5.


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