FHASecure is the program started last August to allow sub-prime borrowers to switch to low, fixed-rate mortgages after they fell behind on payments because their adjustable rate mortgages reset.

Only about 1.5% of the 200,000 refinances through FSASecure are reported to be for those who were about to lose their homes. The rest were homeowners who met the criteria for the program who simply wanted to lower their payments. You can’t fault the homeowners for taking advantage of the program. New requirements in July will change who is eligible.

The new rules, are as follows:

FSA Secure will be open to all subprime ARM borrowers no more than 60 days late (or 30 days late twice in a 12-month period) who have home equity, or cash, equaling 3% of the mortgage principal.

Borrowers three months delinquent (or late three times in a 12-month period) may still qualify if they have 10% home equity.

You no longer have to have had your loan reset to be eligible.

If your lender forgives a portion of your debt to help you gain eligibility for the program, remember that forgiven debt may be subject to income taxes.