The standards lenders use to evaluate prospective borrowers aren't fixed. That means there are times when it's easier for home buyers to get approved for a loan and times when it's more difficult. For that reason, the Mortgage Bankers Association keeps a monthly measure of mortgage credit availability. Any increase in their Mortgage Credit Availability Index indicates that lending standards have loosened and borrowers will have an easier time securing financing. A decline means lenders have stricter requirements and borrowers will have to meet higher financial standards before being approved for a loan. In June, the index found credit availability loosened, though the improvement was slight. According to Joel Kan, MBA's vice president and deputy chief economist, the index remains at a low level due to slower mortgage demand. “Lenders are streamlining their operations by offering fewer loan programs, with some exiting certain channels,” Kan said. “Data from our Weekly Applications Survey indicated that June mortgage applications were more than 30 percent lower than a year ago and at the slowest pace since December 2022.”
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