U.S. Mortgage Credit Availability Increases in October

U.S. mortgage credit availability rose by 0.7% in October 2024, reaching its highest level since April 2023, driven by gains across all loan categories, according to the Mortgage Credit Availability Index (MCAI). Despite the increase, credit supply remains limited, with improvements primarily benefiting cash-out refinances and lower loan-to-value ratio programs. Concurrently, mortgage rates for 30-year fixed loans have increased to 6.64%, with analysts suggesting this might not significantly decrease by the end of 2024. The market is experiencing a notable shift, as conforming loans' share has dropped to its lowest level since 2018, with FHA loans gaining ground among buyers seeking accessible financing. Experts predict continued resilience in cash-out refinancing as homeowners tap into their equity amid rising consumer debt pressures. Economic data will likely influence future mortgage rates, emphasizing the importance of consulting loan originators for potential buyers and refinancers.