Can your customers get credit?

by Ryan Smith12 Feb 2014
Mortgage credit availability was up in January for larger wholesale lenders and investors, according to data released Tuesday. However, credit tightened last month for smaller lenders.

The Mortgage Bankers Association’s Mortgage Credit Availability Index increased to 113.0 in January, up from December’s level of 110.9. increases in the index indicate loosening credit, while decreases indicate that credit is tightening, according to the MBA.

“Overall, mortgage lenders and investors slightly expanded credit offerings in January on net, but this represented the combination of two divergent trends,” said Mike Fratantoni, chief economist at MBA.  “First, the market continues to adapt to the new QM regulation by eliminating products that do not fit inside of the QM box. This tightening is being offset, both in the market for higher balance loans, where lenders continue to loosen terms for jumbo loans, and in the refi market, where more lenders are offering streamline refinance programs.

 “The Federal Reserve's Senior Loan Officer Survey showed that mortgage credit standards loosened somewhat among larger institutions, but tightened for smaller lenders,” he added. “The data underlying the MCAI is predominantly from larger, wholesale lenders and investors.”

But what’s the credit situation in the trenches? Are you seeing tightening credit keeping borrowers away? Let us know in the comments below.


  • by Dennis Duncan | 2/13/2014 6:32:15 AM

    Interesting. Tells me the Fed's letting rates go up finally forced big box lenders to lower their standard closer to historical mean. This is Phase I of thier treatment. Phase II is the cure for analysis paralysis which they have had since 2008.

  • by Traci | 2/14/2014 1:46:57 PM

    Already seeing tightening of credit. I had the following scenario that DU FNMA turned DOWN: 736 middle credit score, 26 yrs on same job, $79K down payment on $129K mortgage = $50K mortgage with 39% LTV. Ratios of 12/47...DENIED!!! Thanks QM.
    Also hard compliance costs are up: third party VOE went from $17.50 to $31.50. 3% cap affecting profit margin and interest rates are going up for clients when lender obsorbed fee is utilized. Consumer Protection is Consumer Harming in many ways!!


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