They have a $30,000, 8 percent mortgage on their house, now worth about $80,000.

For investors, the early repayment of the 11 percent mortgage created problems.

Last March, when 9 percent mortgages were available, the rate exceeded 1.8 million.

Most take out no more than a 30 percent mortgage.

The underlying collateral of these bonds is 8.5 percent mortgages.

If I give somebody an 8 percent mortgage," he said, "everyone else will want it.

Say you have a $150,000, 30-year, 8 percent mortgage, plus $2,500 in property taxes.

If you finance 80 percent of it with a 6 percent mortgage, your interest bill is $6,720 a year.

The Links paid $313,000 and took an 80 percent mortgage.

The state will begin accepting applications for the 5 percent mortgages on Tuesday.