If your adjustable rate has pushed your mortgage payment to unaffordable levels, you may have some relief. In response to the crisis of people facing default on their home mortgages because their adjustable rate mortgages are no longer affordable, the Federal Housing Administration is coming out with the FHA Secure Refinance Program.

The new FHA Secure program would help home owners who have fallen behind on their home mortgage and are possibly facing foreclosure because of their new higher monthly payments. The new program would allow the delinquent home owners to refinance their Adjustable Rate Mortgages into a fixed rate FHA loan. The FHA Secure program is intended to help homeowners that may have been tricked into expensive Adjustable Rate Mortgages with teaser interest rates. If you qualify for an FHA mortgage your loan will be funded by a conventional mortgage lender.

Remember, FHA mortgage loans are insured by the Federal Housing Administration. The FHA does not lend money; they simply insure your debt with an approved FHA lender.

Because your mortgage is insured against default by the government, FHA loans offer significantly less risk for lenders, allowing homeowners, even those with poor credit, to qualify for lower mortgage rates. The FHA will accept homeowners with blemished credit' especially if you are working on improving your finances and can document your current situation. In the past, the FHA has not required borrowers to have a minimum credit score. Instead, they have focused on one's overall credit history.

Therefore, it may be possible to qualify even though you may have a low credit score, perhaps 500 (or less). If you are a homeowner with tarnished credit and are concerned that the current 'mortgage crisis' will prevent you from refinancing before your lender begins adjusting your interest rate and payment amount, FHA backed mortgage refinancing could be your answer.

Apparently, the FHA's focus will remain on looking to the good credit profile of applicants rather than a credit score, And, until now, the FHA has not permitted delinquent borrowers to qualify for their loan program.

To qualify, you must show?.

-That your loan is a non-FHA ARM.

-A history of on-time mortgage payments "prior" to the borrower's ARM loan resetting to the higher rate.

-The Arm loan interest rate must have either reset or be scheduled to reset between June 2005 and December 2009.

-Mortgage late payments are allowed after the reset date if they are directly related to your higher loan payment. In addition, if you are in a mortgage payment plan because of late payments and there is sufficient equity in the home, the late amounts can be rolled into the new loan.

-A minimum of 3% cash or equity in the home.

-A sustained history of employment.

-Sufficient income to make the new mortgage payment.

While the new program will help those borrowers who qualify save their homes, it is obviously not a free ride. It is designed for homeowner's who just need a little assistance in order to get out from underneath expensive ARM interest rates.

The FHA will not insure interest-only or Pay Option ARMs; and will not help home owners who have properties that have depreciated in value and are now worth less then the current mortgage balance. You must use an FHA approved lender to see if you qualify for the FHA Secure Refinance Program. For FHA lenders in your neighborhood, go to

http://locator.fha.gov/cgi-bin/answers_hud_loc.cfg/php/loc/enduser/loc.php

While this program may not help everyone, it certainly doesn't hurt to see if you qualify. It could be a resource to take your ARM to a fixed rate mortgage that is actually affordable.

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