Mortgage Credit Availability Improves in January

Washington, DC, Feb. 23, 2015 -- Mortgage credit availability increased in January, according to the Mortgage Bankers Association.

MBA said its Credit Availability Index increased 1.8 percent to 117.8 in January.  An increase indicates that lending standards are loosening, while a decrease means they're tightening.

“Several new initiatives aimed at making mortgage credit more available and affordable to consumers were recently announced and resulted in a net loosening of credit over the month,” said Mike Fratantoni, MBA’s chief economist.

“Fannie Mae and Freddie Mac announced new 97 percent LTV loan programs in December aimed at expanding access to conventional financing for new and well-qualified homebuyers. Additionally, FHA announced reductions in mortgage insurance premiums. Both of these announcements were designed to provide consumers with better access to mortgage credit."

He said that since these announcements, roughly 40 percent of investors have begun to offer versions of the Fannie Mae 97 percent LTV program.