Mortgage Credit Availability Increases In May

Most home buyers have to secure financing before they can purchase a house. But whether or not they’re approved for a loan depends on more than just their financial situation. There are other factors, like lending standards and the number of available loan programs, that play a role. The Mortgage Bankers Association tracks those factors with its Mortgage Credit Availability Index. The index measures how easy it is for borrowers to get a loan on a scale where any decline in the index means credit has tightened and increases indicate it has loosened. In May, the index increased to its highest level in nearly two years. Joel Kan, MBA’s vice president and deputy chief economist, says the improvement was partly seasonal. “Credit supply increased to its highest level since August 2022, driven by growth in the supply of both conventional and government loans, as lenders offered a greater variety of loan types to support the spring home buying season,” Kan said.