Easing of Accepted Credit Scores Helps Mortgage Availability

Easing of Accepted Credit Scores Helps Mortgage AvailabilityMortgage credit availability rose slightly in October after a reduction in the minimum credit scores accepted for certain products, according to an index-based update from the Mortgage Bankers Association.
The MBA’s Mortgage Credit Availability Index (MCAI), increased 0.7 percent to 111.5 in October, following two consecutive months of decline in August and September.
A decline in the MCAI indicates that lending standards are tightening, while increases in the index are indicative of a loosening of credit.
The index was benchmarked to 100 in March 2012.
If it had been tracked in 2007, it would have been at a level of roughly 800, indicating the credit was much more available before the housing market meltdown and financial crisis.
Mortgage credit loosened slightly in October relative to September.  In October, some investors reduced minimum credit scores on certain products.
At the same time, other investors reduced the availability of cash-out refinances and limited other programs to primary residences in programs which previously allowed for second and investor homes.
The net impact was a slight increase in the index for the month, the MBA said.

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