When Howard Boyd of Hyattsville got the call yesterday morning, "I immediately stopped arguing with my wife and started dancing around."

Boyd, a mechanical engineer, was one of the winners in an unusual lottery held yesterday by the State of Maryland. The prize: low-interest mortgage money.

About 125 of the 217 state residents who applied for the home loans for low- and moderate-income persons will get them, the state Department of Economic and Community Development estimates.

State officials grouped applicants by county, and the lottery established a priority list for each group. Those at the top are guaranteed the first shots at trying to meet the state's stringent requirements for getting the cheap mortgage funds.

The state has offered subsidized mortgage money in the past, but until this year it doled out the funds on a first-come, first-served basis. This led, understandably, to a rush on state offices by would-be home buyers competing to be at the front of the line.

Having lines of people camped outside for days "made for good TV," said Dennis McGee, press secretary for the economic development department, but it "got hectic" and every year the department got complaints of people butting ahead in line.

This year the department decided to take applications first and then try the lottery system as "more equitable" and to "save wear and tear on people," McGee said.

The state has $4.5 million, raised in a state bond issue earlier this year, that it will loan at 93/4 percent interest. Each of Maryland's 24 counties will get some of the money, to be distributed according to the lottery list.

The final number of applicants apparently understates the level of interest among state residents in the loans during this time of stunning mortgage interest rates. The state gave out about 6,000 applications to Marylanders who had requested them, but got back only 217 with the $115 filing fee.

Many of those who first expressed interest probably didn't qualify for the loans, since the eligibility requirements include more hurdles than O.J. Simpson trying to catch a plane during an air controllers' strike.

The highest family income limit is $29,900, and the maximum loan amount is $46,500. Applicants must not have other real property or available cash assets that would help them get a private mortgage -- but they must be able to provide a 5 percent down payment, which may not be borrowed.

To be eligible, would-be home buyers also must have "established credit, good general credit standing," stable employment and other evidence they are good risks. But they also must be able to prove that they cannot get a mortgage elsewhere, and they have to have at least two letters of rejection to prove it.

Only single-family residences, not including mobile homes or co-ops, are to be bought, and these must be "of modest means" and "safe, sanitary and adequate for the family's current needs," according to an official information sheet.

Boyd, 26, whose name is No. 1 on the Prince George's County list, said he and his wife Michelle, 23, had only 11/2 weeks after finding out about the program to find a house they wanted and to get papers drawn up on it. They found a two-bedroom house on a quarter-acre lot in Hyattsville and now are just waiting to see if their luck on the draw will be accompanied by success in meeting all the state's requirements.

By afternoon, Boyd was a bit more restrained than when he first heard that his name was at the top of the Prince George's list and did a jig around his living room, but he says he is optimistic he and his wife can meet all the requirements.

When they do, he says, "It's going to mean not having to pay rent again. It's going to mean finally getting a mortgage."