BankAmerica Mortgage has started a lending initiative in metropolitan Boston designed to offer low-income and immigrant homebuyers both purchase and renovation loans.

The program is a partnership among BankAmerica Corp., Fannie Mae, and the Metropolitan Boston Housing Partnership Inc. BankAmerica Mortgage, based in Charlotte, N.C., will originate the loans and market the program with nonprofit organizations. Fannie Mae will buy the loans.

Lenders say consumer awareness has been the major obstacle to making purchase/rehabilitation loans to all types of borrowers. But originations could increase as more homes in need of renovation come on to the real estate market.

"All of the trends point to the rehabilitation market as one that will thrive in coming years because of aging housing stock," said Steve O'Connor, senior director for residential finance at the Mortgage Bankers Association.

Boston was chosen for the program because of the density of older housing stock there and the high number of immigrant and minority families, said Cynthia Allison, vice president and market development manager for BankAmerica Mortgage.

In Boston, nearly 60% of the housing stock is more than 60 years old, said Mickey Karpa, senior rehabilitation specialist at Metropolitan Boston Housing Partnership. Boston also has a predominance of multifamily housing built at the turn of the century to cater to immigrant populations, he said. These houses, known as "triple-deckers," were home to three generations at a time.

And today this living arrangement, which provides an affordable way to own a home and gain income from renting, is back in vogue among low-income homeowners and new immigrants from Haiti, India, Vietnam, and Cambodia, Mr. Karpa said.

Purchase/rehabilitation loans have been available nationally for almost 30 years, first through the FHA program and over the past two years through Fannie Mae and Freddie Mac. First-time buyers can apply for loans to purchase and remodel a home; homeowners with a mortgage can apply for loans to refinance and remodel.

BankAmerica's program features some alterations to Fannie's loan program that are designed to attract low-income borrowers.

It includes a partnership with nonprofit organizations to provide professional oversight for the bank and mandatory counseling for homebuyers, Ms. Allison said.

Borrowers may get up to 95% financing for one- and two-family homes and up to 90% for three-family homes. The bank is also offering a down-payment feature whereby 3% of the purchase price comes from a borrower's funds and 2% from a gift or grant.

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