Mortgages became marginally more difficult to qualify for in November as a “significant number” of programs that permit a loan-to-value ratio above 95 percent and low- to midrange minimum FICO scores were discontinued or transitioned into programs with stricter requirements, the Mortgage Bankers Association reported.
Mortgage credit availability decreased slightly by 1.2 percent last month, as reflected in the association’s Mortgage Credit Availability Index (MCAI) drop from 111.5 in October to 110.2 in November. The index was benchmarked to 100 in March 2012. If it had been tracked before the prerecession days of 2007, the index would have been at a level of roughly 800.
As some programs targeting low-income borrowers were phased out in November, investors also continued to pull out from programs with greater than 30-year terms, as well as interest-only programs, in anticipation of new regulations that will take effect in January 2014, according to the MBA.