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Banks and other lending institutions clamped down on lending standards when the pandemic hit, but mortgage credit availability has been easing in recent months.

The Mortgage Bankers Association’s Mortgage Credit Availability Index rose 0.8% in December, indicating lending standards are loosening, not tightening. Some of the recent increase in credit availability is from expanded offerings of lower credit score loan programs, which is good news for potential qualified borrowers who are most impacted by rising rates and affordability challenges.

“I think this is going to be helping a lot of households who either are new in terms of their credit history, or had some kind of credit event that might have lowered their scores over the last two years,” said Joel Kan, associate vice president of economic and industry forecasting at the Mortgage Bankers Association in D.C.

While the overall supply of mortgage credit in December was up only 3% compared to a year earlier, there was a 34% increase in jumbo credit availability. Those are nonconforming loans that are too big for Fannie Mae and Freddie Mac. Those high-end borrowers often have lower risk profiles.