Its Mortgage Credit Availability Index, compiled with data from AllRegs Market Clarity product, increased 70 basis points during the month to 110.9. The fact that more credit is available, not less, is a sign that many investors previously made changes to their programs to deal with the qualified mortgage rule being implemented on Jan. 10.
This follows a 130 bp decline in the MCAI in November, brought on by many lenders dropping such programs as 95% loan-to-value ratio mortgages to low credit score borrowers, mortgages with terms over 30 years, and interest-only loans.
Bank of the West says it is willing to do non-QM interest-only mortgages, but will hold those in portfolio.
The MCAI, which had been trending up between October 2012 and July 2013, has had no discernable direction since then. MCAI reached 112.3 in July, declined the next two months to 110.7 for September. The next three months shows the index going up, back down and then up again.