The recession and the resulting loss of jobs caused many to lose their homes. Normally hardworking folks suddenly found themselves out of work and caused some to resort to the unthinkable; give up their homes.

As to acknowledge the critical role the housing market plays in economic recovery, recent steps by the government may make it easier for those who lost their homes to enjoy, once again, the benefits of homeownership.

In mid-August, the U.S. Department of Housing and Urban Development (HUD) sent letters to lenders who write loans insured by the Federal Housing Administration (FHA). In this letter HUD announced a revision of its list of "extenuating circumstances." In the letter HUD states:

"As a result of the recent recession many borrowers who experienced unemployment or other severe reductions in income, were unable to make their monthly mortgage payments, and ultimately lost their homes to a preforeclosure sale, deed-in-lieu, or foreclosure. Some borrowers were forced to file for bankruptcy to discharge or restructure their debts. Because of these recent recession-related periods of financial difficulty, borrower's credit has been negatively affected. FHA recognizes the hardships faced by these borrowers, and realizes that their credit histories may not fully reflect their true ability or propensity to repay a mortgage."

"To that end, FHA is allowing for the consideration of borrowers who have experienced an Economic Event and can document that:

* Certain credit impairments were the result of a Loss of Employment or a significant loss of household income beyond the borrowers control.

* The borrower has demonstrated full recovery from the event; and,

* The borrower has completed housing counseling."

This will change things for many who may be back to work and have worked hard to improve their credit by showing 12 months of on-time payments. We have already seen many former homeowners who suffered early in the recession come back into the market. Some of those were able to prove hardship with Fannie Mae or Freddie Mac have successfully maintained their credit history since their loss and have waited the prescribed periods of time to qualify for those loans. The addition of this new category to the list of extenuating circumstances for FHA loans will enable more people to qualify for those loans and will provide another path to homeownership.

Also, last week the National Association of Realtors announced that proposed changes to Qualified Residential Mortgage rules will help more people afford homes. Under the proposal a borrower would pay a down payment of 10 percent, not 20, for a home loan. This would obviously allow people to save up a down payment much quicker. Also under consideration is raising the Debt to Income ratio for those wanting a mortgage on a home. Of course this topic is up for debate but does seem to have bi-partisan support and the support of the president. Stay tuned.

Trust an expert...call a Realtor. Call your Realtor or visit www.cdarealtors.com to search properties on the Multiple Listing Service or to find a Realtor member who will represent your best interests.

Kim Cooper is a real estate broker and the spokesman for the Coeur d'Alene Association of Realtors. Kim and the association invite your feedback and input for this column. You may contact them by writing to the Coeur d'Alene Association of Realtors, 409 W. Neider, Coeur d'Alene, ID 83815 or by calling (208) 667-0664.