WASHINGTON (AP) -- A top Bush administration official says the government will let more borrowers qualify for a new $300 billion program that lets troubled homeowners swap risky loans for more affordable ones.
Department of Housing and Urban Development Secretary Steve Preston said Wednesday the changes aim to expand participation in the new "Hope for Homeowners" program, launched Oct. 1.
The new rules enable lenders to take a smaller loss because new loans can be made for 96.5 percent of the home's value, rather than the current level of 90 percent.
Also, lenders will be allowed to create new 40-year mortgages, rather than the traditional 30-year term, which will lower borrowers' monthly payments but cost them more in interest over the life of the loan.
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