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

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Believe me, rates are great right now, but lenders are not just “giving away” mortgages. There is a lot of verification that takes place and buyers need to actually be able to afford to purchase a home.

I’ve recently run into a few situations where some of the guidelines actually violated common sense. Fortunately, I’ve been able to find workaround solutions with some of my more creative lending partners. And by creative, I mean those who will look at the whole situation and dig into the gray areas while remaining in full compliance.

Real estate is not black and white and it often requires creative solutions and problem-solving to get to the closing table. That’s part of the job that I’ve really grown to love and where I begin to shine. That’s not 100% what this article is about, but it’s worth a quick read anyway.

Why This Is Not 2008 All Over Again

Some are afraid the real estate market may be looking a lot like it did prior to 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.”

Basically, 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:

In the early 2000s, it was difficult to NOT qualify for a mortgage.As we can see, the index stood at about 400 in 2004. Mortgage credit became more available 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 difficult. The difference in 2006? At that time, it was difficult not to get a mortgage.


Thinking of buying or selling a home? Simply have a real estate related question, concern, or need? Contact Costello Real Estate & Investments’ Jimmy Grappone at or (980) 298-9385.

Want to know more about interest rates or have other mortgage-related questions? Call or text Michael Curtis with Movement Bank at (803) 389-5256 or email him at

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