With The growing number of delinquent mortgage borrowers, the Federal Housing Administration announced Friday that it will now assist borrowers even before they become delinquent. With that, borrowers would no longer have to be late in payments before qualifying for FHA help.

With the new set-up, borrowers would just need to prove that there is a reduction of income caused by a job loss, less paid work hours, slashed wages or a decline in self-employed business earnings. Also a factor to qualify is death or disability in the household.

FHA Commissioner David Stern in a prepared statement about the work-outs said, "The FHA has always required lenders to establish early contact with delinquent borrowers to discuss the reason for missing a payment and to evaluate reinstatement options."

"Now servicers will have additional options for those borrowers who seek help before they go delinquent, which increases the likelihood that the borrower will be able to retain their home," He added

The approach or workouts include forbearance where lenders will agree to postpone or reduce payments for a specified period.

In more severe cases, when borrowers may qualify for permanent payment reductions, where any or combination of three modes can be agreed upon which are as follows: the length of the loan is increased; reducing the interest rate; and/or even forgiving principal.