An increase in credit access was reported in April according to the Mortgage Bankers Association’s Credit Availability Index (MCAI).
The Index increased 0.5 percent month-over-month to 122.0 in April. The increase was driven by new offerings of FHA’s 203K home improvement program, new VA offerings, and new jumbo products.
The MCAI and its four components are designed to show relative credit risk/availability based on information about borrower eligibility and underwriting criteria gathered for over 95 lenders and investors and combined with data from Ellie Mae’s All Regs Market Clarity product.
Two major banks have agreed to originate a new 15-year mortgage under pilot programs aimed at low- and moderate-income borrowers.
In addition, the creators of the so-called Wealth Building Home Loan, allows home buyers to build equity at a much faster clip than they would with a standard 30-year loan. Typically, the monthly payment on a 15-year loan is higher than that on a 30-year loan. But the loan amortizes much more quickly, meaning you build wealth — or equity — faster.
According to the latest Federal Reserve Survey of Consumer Finances, an owner’s net worth is 36 times greater than that of a renter. The survey found that the average owner’s net worth is $194,500, whereas a renter’s is $5,400.