A push to create more low down payment lending options boosted mortgage credit access by 1 percent in December, according to a monthly measure.
The clear driver behind the increase was an announcement earlier in the month that both Fannie Mae and Freddie Mac are launching new 97 percent loan-to-value (LTV) mortgage programs for qualifying homebuyers, said Mike Fratantoni, MBA's chief economist.
"However, since only one of the two GSEs has gone live with their updates and the resulting investor pickup can be a delayed process, the impact of this announcement may take some time to fully quantify," Fratantoni said. "Furthermore, Fannie Mae had been offering 97 LTV options until late October 2013 so this is really a reintroduction."
Since the programs were announced, about one-quarter of investors contributing to the MCAI data have started offering high-LTV loans, MBA said.
In addition to the high-LTV programs, the index also picked up on continued expansion in jumbo loan offerings, Fratantoni added.
Both the conventional and government component indices improved moderately in December, according to MBA, picking up 2.2 percent to 84.9 and about 0.3 percent to 247.7, respectively. While the headline index is benchmarked at 100, the two components are separately calibrated to 69 and 222 (all set in March 2012).