Countrywide Credit Industries last week announced a new FHA adjustable- rate mortgage that promises low down payments, low interest rate caps, and the option of financing closing costs.

The borrower also has the option of paying a fee to get a reduction in the initial interest rate.

The "Low Down Easy Loan" is aimed at first-time homebuyers in low to moderate income brackets.

"We're targeting first-timers and individuals who usually can't overcome barriers to homeownership, like the down payment hurdle and closing costs," said Laura Lippman, a spokeswoman.

With a low down payment and financing of closing costs, Countrywide hopes to reach a larger market of Federal Housing Administration borrowers.

'The annual cap is 1%, rather than the usual 2%, and the lifetime cap is 5%, while the average ARM cap is 6%. Down payments can be kept to 3% in some cases.

Countrywide hopes to build its volume in purchase mortgages, a crucial market now that refinancing business is all but dead, and is especially interested in government products, Ms. Lippman said.

To ease the financial burden during the initial years of the loan, the borrower can "buy down" the interest rate, paying a fee to set it two points below the contract rate in the first year and one point in the second year.

Countrywide is not the only mortgage company seeking access to the first-time home buyer with low down payments for adjustable rate products.

PNC Mortgage Corp., Vernon Hills, Ill., has introduced a low-down- payment adjustable rate loan.

Through its "Triple Play," which offers 3% down and a fixed-rate for the first 10 years of the 30-year model, PNC is hoping to ease fears of rising rates.

The low-down-payment trend started in February 1994 as GE Mortgage Insurance Co., Commonwealth Mortgage Assurance Corp., and Mortgage Guaranty Insurance Corp. committed to insuring loans made with 3% down and the Federal National Mortgage Association began buying the loans.

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