As the number of Californians who can afford to buy a home creeps below 20 percent, those in the home-loan business have created new ways to help everyone buy a house, especially first-time home buyers.

From funds for teachers, to zero down payments, to interest-only mortgages, loan companies have reinvented the concept of a loan after decades of offering two options: Do you want to pay your loan off in 15 years or 30 years?

"As many homes are on the market is how many loan programs there are," said Gretchen Pearson, Prudential California Realty's chief operating officer.

Now, comes the 40-year mortgage - another chance, another opportunity to buy a home for those who are stretched to the limit and need a tiny bit of help. Indeed, tiny is the operative word. Although a few mortgage companies have offered 40-year loans for several years, this is the first time the venerable Federal National Mortgage Association, better known as Fannie Mae, is offering the loan through a pilot program in Minnesota. Hard to know why Minnesota, but there it is.

"The concept of a 40-year mortgage is the answer to: Why a 30-year mortgage? Why not 40? Why not 50?" asked Christopher George, president of CMG Mortgage Services Inc. in San Ramon.

In other words, it's all arbitrary. Well, not so fast, says George. The fact that Fannie Mae is offering the program is significant.

"Fannie Mae is attempting to bridge the gap between amortized loans and nonamortized loans. It continues the agency's focus on home ownership and that's a very good thing - it's the thing," he said.

George applauds Fannie Mae and Freddie Mac- even if few join him - for being the two reasons home ownership in the United States is nearing 70 percent. If this boosts that number higher, it's all good.

So what are the chances of a 40-year mortgage catching on? The difference between the monthly payment on a 30-year mortgage versus a 40-year is not overwhelming - about $150 a month on a $300,000 loan. And considering the interest rate is higher on the longer-term loan, the unpopularity of the 40-year plan is understandable. But if interest rates rise significantly, the popularity of a 40-year loan probably will, too.
Another state, another trend

Not every kooky concept comes from California.

California prides itself as the nation's trendsetter, but Florida may pave the way when it comes to pooches. Apparently so many condo buyers have dogs that the enterprising owners of Porto Bellagio Condos and Aventi Townhomes in South Florida have begun "interviewing" canines to determine whether they should be admitted. Previously dogs under 20 pounds were allowed, but as we all know, the smaller the dog, the larger the attitude.

Fido or Fifi, must first log some play time with another dog to determine if the pet gets along well with others; then it must obey a command; and finally interact with a stranger to see how it handles people. On second thought, it doesn't sound so nutty.

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