First Union Corp. has introduced two new mortgage loans designed to increase homeownership among low- and moderate-income families.

The loans are intended to expand the options of families who have been able to pay their rent but couldn't clear the financial hurdles to homeownership.

Both mortgages are available to families with incomes 80% or less of the median in their local area.

One loan offers rates 1 point below the conventional rate and repayment periods of 10 to 25 years. Down payments can be as little as 5%, of which only 3% need come from the borrower's funds. The rest can come from gifts, grants, or other sources. There is no minimum or maximum loan size, but homes must be in low- or moderate-income areas as defined by the Census Bureau.

The second loan offers up to 100% of a home's value. Only $500 of the borrower's funds are needed at closing, and the mortgage insurance requirement is waived by the sponsor. These borrowers are required to work with a local nonprofit community organization to learn about homebuying and financial planning.

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