By Brian Eckhouse (contact)

Wed, Oct 1, 2008 (3:22 p.m.)

Starting today, existing homeowners at risk for foreclosure – but could afford a new loan – can seek federal assistance to help pay off their mortgages.

There is a stipulation for many prospective homeowners in getting the government-backed mortgage: convincing the bank or lending company that approved the existing mortgage to drop it to 90 percent of the new appraised value of the home. The new Federal Housing Administration loan would be paid back at a fixed-rate over 30 years.

As the Sun reported last month, this new Hope for Homeowners initiative replaces a specific down-payment assistance program that was especially popular in the Las Vegas Valley called Nehemiah. It ended Tuesday.

Under Nehemiah, sellers desperate to sell their homes would contribute a small contribution to the down-payment, generally between three to six percent of the sale price, enabling homebuyers to avoid putting down any money of their own. But federal housing leaders came to suspect that sellers tended to hike up the sales price to make up the difference, and they’ve long believed that homebuyers who had no financial ties to a property from the onset were more likely to foreclose.