The Mortgage Bankers Association's (MBA's) Mortgage Credit Availability Index (MCAI), a measure of access to mortgage credit, partially rebounded from an unusually large downturn in December.  The Index rose 2.3 percent in January to 179.0. A lower MCAI indicates that lending standards are tightening while increases means credit is loosening.  The MCAI fell 7.3 percent the prior month, driven by a 14.5 percent decline in the Conventional MCAI.

The Conventional MCAI increased 4.9 percent while the Government MCAI was unchanged. Of the component indices of the Conventional MCAI, the Conforming MCAI increased by 7.3 percent, and the Jumbo MCAI increased by 3.0 percent.  

"There was an increase in the supply of mortgage credit in January, which was a reversal from the December pullback that was caused by the end of the Home Affordable Refinance Program (HARP) and a reduction in jumbo offerings," said Joel Kan, MBA's Associate Vice President of Economic and Industry Forecasting. "Last month, investors and lenders added more programs to cater to lower credit score borrowers, in addition to new relief refinance programs. These relief refinance programs are not a direct replacement for HARP but do serve a similar purpose to assist borrowers who may have run into financial challenges." 

The MCAI is calculated using several factors related to borrower eligibility (credit score, loan type, loan-to-value ratio, etc.) gathered from over 95 lenders and investors. They are combined with data from an AllRegs proprietary product to calculate a summary measure indicating the availability of mortgage credit at a point in time

The MCAI and its components are designed to show relative credit risk/availability for their respective indices and were benchmarked in March 2012. The total MCAI, Conforming, and Jumbo indices were indexed at 100 while the Conventional and Government indices were indexed at 73.5 and 183.5 respectively to better represent where each index might have been relative to 100.