Mortgage Credit Availability Expands Slightly

The ""Mortgage Bankers Association's"":http://mba.org/default.htm (MBA) latest analysis of underwriting criteria shows mortgage credit availability opened up in October.

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MBA's Mortgage Credit Availability Index (MCAI) increased 0.7 percent last month to 111.5, putting a stop to declines recorded in the previous two months.

According to the association, October's gain reflects a reduction in minimum credit scores by investors on certain products; that was offset slightly by other investors reducing the availability of cash-out refinances and limiting other programs to primary residences which had previously allowed for second and investor homes.

The MCAI, which combines MBA data with statistics from ""AllReg's"":http://www.allregs.com/ Market Clarity product, calculates availability using several factors related to borrower eligibility and underwriting criteria from more than 85 lenders and investors. The index is benchmarked to 100 in March 2012; had it been tracked in 2007, the MCAI would have posted a level of roughly 800.