The Mortgage Bankers Association (MBA) said on
Tuesday that an anomaly was likely responsible for the slight downward shift in
mortgage credit available in October.
MBA’s Mortgage Credit Availably Index (MCAI) dipped 2.5 percent compared
to September. The October index reading
is 113.2. A decline in the MCAI means
that lending standards are tightening.
Mike Fratantoni, MBA’s Chief Economist explained that the major cause of the
decline was the removal of special loan programs that applied only to sales of
bank-owned real estate (REOs). “These programs were likely discontinued due to the
shrinking level of REO properties for sale on the market,” he said.