More mortgage money now available for those of modest means

NEW YORK -- If you haven't been able to raise the money for a home of your own, take another look at what mortgage lenders have to offer. Loans are increasingly granted to people with low down payments or modest means. Government-backed FHA loans are the major source. But private investment is steadily streaming into the field.

Some 900 lenders -- some of them local, some nationwide -- now participate in the affordable-housing programs backed by Fannie Mae (the Federal National Mortgage Association) and Freddie Mac (the Federal Home Loan Mortgage Corporation). These government-chartered corporations raise private money to buy NTC mortgage loans. The more funds they set aside for low-down payment programs, the more the bankers will be able to lend.

Take Fannie Mae's Community Home Buyer's Program (CHBP), which got rolling in 1991. In most places, it serves people who have up to 115 percent of the area's median income. In Detroit, for example, the median income is $46,700 for a family of four, so they would be eligible with incomes up to $53,705. For the median in your area, and the Fannie Mae lending limit, call 1-800-7-FANNIE.

Where housing costs are high, the limits go up. In California and the Boston metro area, you qualify with up to 120 percent of the median income; in the New York metro area, it's 165 percent; in Hawaii, up to 170 percent.

There's no income limit if you buy in the designated central sections of 544 cities all over the United States.

In the first year, CHBP lenders made around 7,200 mortgage loans on single-family homes, condominiums and townhouses. By last year, that number had risen to 62,000. This year's lending will go higher yet.

By calling 1-800-7-FANNIE, you can also get a free list of CHBP lenders in your region, plus the name and phone number of a loan officer to ask for. Having the names can be important. Only one or two loan officers may even know about the program (which the bank may call by a different name).

Borrowers have to be creditworthy. You need a stable income and can't be behind on your bills or your rent. But the credit standards aren't as stiff as for the usual homebuyer.

You have to be planning to live in the house; real estate investors don't qualify. Among the terms available, either to buy or refinance: