This Is Not 2008 All Over Again The Mortgage Lending Factor

Dated: 11/22/2019

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This is Not 2008 All Over Again: The Mortgage Lending Factor | MyKCM

Some are afraid the real estate market may be looking a lot like it did before the housing crash in 2008. One of the factors they’re pointing at is the availability of mortgage money. Recent articles about the availability of low-down-payment loans and down payment assistance programs are causing concern that we’re returning to the bad habits of a decade ago. Let’s alleviate the fears about the current mortgage market.

The Mortgage Bankers’ Association releases an index several times a year titled: The Mortgage Credit Availability Index (MCAI). According to their website:

“The MCAI provides the only standardized quantitative index that is solely focused on mortgage credit. The MCAI is…a summary measure which indicates the availability of mortgage credit at a point in time.”

The index determines how easy it is to get a mortgage. The higher the index, the more available the mortgage credit.

Here is a graph of the MCAI dating back to 2004, when the data first became available:This is Not 2008 All Over Again: The Mortgage Lending Factor | MyKCM As we can see, the index stood at about 400 in 2004. Mortgage credit became more accessible as the housing market heated up, and then the index passed 850 in 2006. When the real estate market crashed, so did the MCAI (to below 100), as mortgage money became almost impossible to secure.

Thankfully, lending standards have eased since. The index, however, is still below 200, which is half of what it was before things got out of control.

Bottom Line

It is easier to get a mortgage today than it was immediately after the market crash, but it is still tricky. The difference in 2006? At that time, it was difficult not to get a mortgage.

Thinking about relocating to Sunny SW Florida and not sure about financing? Let our experts get you the financing you need. Call me Today at 941-626-9000

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Leo Albanes

I am a Licensed Florida Real Estate Broker, Realtor®, and Owner of Charlotte County Properties Inc for over 16 years. In that time, I have received many review, awards and testimonials demonstrating....

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