Mortgage credit availability increased in January, according to the Mortgage Bankers Association’s (MBA) Mortgage Credit Availability Index (MCAI), a report that analyzes data from ICE Mortgage Technology.

The MCAI rose by 2.5 percent to 99 in January. According to the MBA, a decline in the MCAI indicates that lending standards are tightening, while increases indicate loosening credit. The conventional MCAI increased 3.8 percent, while the government MCAI increased by 1 percent, the jumbo MCAI increased by 5.3 percent, and the conforming MCAI rose by 0.5 percent.

“Credit availability increased to start 2025, driven by conventional credit supply rising to its highest level since June 2022,” MBA Vice President and Deputy Chief Economist Joel Kan said in a release. “There were expanded loan offerings for cash-out refinances, along with more jumbo and non-QM loan programs. Although similar to last month, these were limited to borrowers with better credit. All other subindexes saw increases in January, a positive development for the spring homebuying season, if these trends continue.”

The conventional, government, conforming, and jumbo MCAIs are constructed using the same methodology as the total MCAI. The primary differences between them are the population of loan programs which each examine. The government MCAI examines Federal Housing Administration (FHA), Department of Veteran Affairs (VA) and United States Department of Agriculture (USDA) loan programs, while the conventional MCAI examines non-government loan programs.

The jumbo and conforming MCAIs are a subset of the conventional MCAI and do not include FHA, VA, or USDA loan offerings. The jumbo MCAI examines conventional programs outside conforming loan limits, while the conforming MCAI examines conventional loan programs that fall under conforming loan limits.

The MCAI is calculated using several factors related to borrower eligibility, including credit score, loan type and loan-to-value ratio. These metrics and underwriting criteria for over 95 lenders and investors are combined by MBA using ICE Mortgage Technology data and a proprietary formula to calculate the MCAI.