By Ovunc Kutlu
ISTANBUL (AA) - Mortgage credit availability in the US increased in August, reaching its highest level since July 2022, according to a Mortgage Bankers Association (MBA) report released on Tuesday.
The Mortgage Credit Availability Index, calculated by credit score, loan type and loan-to-value ratio for borrower eligibility, rose 0.9% to 99.0 in August from 98.1 in July, MBA said in a statement.
A decline in the index indicates lending standards are tightening, while increases are indicative of loosening credit.
"Mortgage rates have been on the decline since May 2024, prompting a pickup in refinance activity, which remains limited to a smaller segment of homeowners with higher rates," said MBA’s Vice President and Deputy Chief Economist Joel Kan.
"As a result, the increase in credit availability was the result of lenders broadening their refinance offerings to meet the greater demand," he added.
Mortgage applications in the US rose 1.6% for the week ending Aug. 30, as mortgage rates declined for the fifth consecutive week, MBA said in a report last Wednesday.