Mortgage credit availability slips as lenders tighten standards
Joel Kan, CMB, MBA’s Vice President and Deputy Chief Economist, attributed the decline to a narrowing of product options across the conventional market.
“Mortgage credit availability decreased slightly in September, as lenders tightened documentation requirements on conventional loans and reduced offerings of loans that allow for cash-out refinances and investor home purchases,” Kan said.
“This tightening in credit supply also impacted jumbo loan programs, which saw credit availability decline for the second consecutive month. However, recent growth in non-agency loan programs continues to support this segment of the market. The government index was unchanged and has remained stable over the past three months.”
Joel Kan, vice president and deputy chief economist at the Mortgage Bankers Association, says higher rates are dampening both refinance and purchase activity, with first-time and FHA borrowers feeling the pressure most. https://t.co/J6NsbEmSbF
— Mortgage Professional America Magazine (@MPAMagazineUS) October 7, 2026
Conventional loans drive the pullback
The Conventional MCAI fell 0.4% in September, the steepest single-month drop among the report’s component indices.
Within that category, the Jumbo MCAI declined 0.3%, recording a second straight monthly contraction in a segment that had earlier in the year been among the key drivers of credit expansion, as jumbo loan growth was spurring higher mortgage credit availability across the market.
