Mortgage credit availability refers to how easy it is for a borrower to get approved for a loan. When credit is less available or tighter, prospective borrowers’ financial standing and credit history have to meet a higher standard than when it’s more available or looser. The Mortgage Bankers Association tracks changes in credit availability with their monthly Mortgage Credit Availability Index. In June, it found that credit availability fell 3.3 percent from the month before, indicating that lending standards tightened. Joel Kan, MBA’s vice president of economic and industry forecasting, says jumbo loans saw the the biggest change. “Mortgage credit supply dropped again in June, as investors further reduced their willingness to purchase jumbo loans and those with lower credit scores,” Kan said. “Lenders are navigating a gradual economic and housing recovery that is still facing headwinds from the ongoing COVID-19 pandemic.” The index shows that the availability of jumbo loans suffered the biggest decline, dropping 7.3 percent. Conforming loans, on the other hand, were down just 1 percent, while government loans fell 2.8 percent. The conventional MCAI was down 4.1 percent from May. (source)