The largest national organization representing America's senior citizens has a real estate message for the nation's bankers:

Forget all those seductive cut-rate come-ons for equity credit lines and second deeds of trust. Forget your 5.9 percent introductory teaser rates that escalate to double digits six months later. Instead, how about offering the real estate financial product that millions of older homeowners need now and in the future -- creative equity-conversion plans?

That's the word from the American Association of Retired Persons, the 25 million-member, Washington-based advocacy group. What bugs the association about the equity boom is that it's creating problems for some elderly, particularly those who've paid off their mortgages but have modest incomes.

"People hear 'equity line' and they think it's 'equity conversion,' " complains Katrinka S. Sloan, the association's housing specialist. "But the fact is the two are worlds apart."

Equity conversion is a concept developed primarily for older homeowners. Though it can take several forms, the most common is the "reverse mortgage." It is a mortgage that works backward: The lender sends payment checks monthly to the borrower, rather than requiring the borrower to send checks to the lender.

The debt is repaid with interest when the borrower dies or sells the house, or after 10- or 20-year terms in some cases. Default or foreclosure -- with the threat of throwing the borrowers out of the house -- are not issues.

Heavily publicized equity credit lines and other forms of second mortgages, by contrast, require payments to the bank. With their souped-up introductory terms, they tantalize homeowners who need instant cash. But equity lines, warns Sloan, can land seniors on the street if they miss just a payment or two. They also require monthly income levels that are beyond the economic reach of many retired families.

So what's the problem? Equity conversion clearly is the way to go for seniors. Equity credit lines are for the young. That's fine, says Sloan, but look at the market. Banks and savings and loans are falling all over one another in the scramble to offer home-equity credit lines at seemingly giveaway rates. But virtually none of their energy is being spent on equity conversion.

In fact, Sloan says, finding any form of equity-conversion alternative can be a tough challenge for older homeowners, no matter where they live. Some of the best plans available are coming from state government agencies. The federal government may plunge into the field as well.

Here's a quick overview of some of the equity plans currently available or scheduled for debuts in coming months. The facts come partly from the association's Home Equity Information Center, which Sloan heads. (For additional state-by-state help, consumers can write to AARP at 1909 K St. NW, Washington, D.C. 20049.) Commercial plans: The first and only successful private-sector equity conversion finance plan comes from American Homestead Mortgage Corp. of Mt. Laurel, N.J. It offers a long-term reverse mortgage that is guaranteed to pay checks to homeowners for as long as they live in their residences. Monthly checks average $400 to $500. The basic interest rate currently is 11.5 percent. The lender is repaid from the proceeds of the home sale. In addition to interest, American Homestead receives a share of the appreciation in the house following the start of the reverse loan. The equity share can go no higher than 15 percent of each year's growth in value.

The American Homestead reverse mortgage is available in New Jersey, Pennsylvania, Connecticut, Maryland and Ohio. The company is gearing up to enter the huge California market and hopes eventually to go nationwide.

State plans: A growing number of states offer equity-conversion programs for seniors. The largest are in Connecticut and Rhode Island. Virginia's Housing Development Authority is readying a "credit-line" plan allowing consumers to draw down cash amounts at low rates. No repayments would be required until the house was sold.

Federal programs: The 1987 housing bill moving through Congress authorizes the Federal Housing Administration to insure up to 2,500 reverse mortgages. Sloan calls it watershed legislation for seniors. The current prospect, though, is for a presidential veto of the entire housing bill on budget-busting grounds.