Credit availability opened up a little bit more in July as lenders added more jumbo loan offerings and loosened criteria for certain government-backed loans.
According to the group, the main force behind the increase was a rise in the number of jumbo adjustable-rate mortgage (ARM) programs, with many investors adding 5/1, 7/1, 10/1, and 3/1 offerings.
Also contributing to the pickup was an increase in availability of high-balance Federal Housing Administration (FHA) and Department of Veterans Affairs (VA) loan programs. MBA also reported slight loosening in lender criteria for those programs with respect to minimum credit scores and maximum loan-to-value ratios.
MBA calculates its credit availability index using several factors, including credit score, loan type, and loan-to-value ratio. Those metrics and underwriting criteria for more than 85 lenders and investors. The benchmark for the index is 100, established in March 2012. For reference, it would have measured above 700 at the height of the recent housing bubble.