They are the public service backbones of hundreds of communities around the country: teachers, firefighters, police officers, nurses and hospital workers. But often, they cannot afford to buy a home anywhere close to where they work.

Now a forthcoming targeted-

mortgage program from two of the biggest players in the U.S. real estate market just might help change that.

Recent research studies by the National Housing Conference and the Homeownership Alliance have documented what many of these workers have known for years: Escalating housing prices have frozen them out of home buying, at least using traditional mortgages.

Among their findings:

* A police officer's median salary in the nation's 60 largest metropolitan areas is not enough to qualify for a conventional mortgage on a median-priced house in nearly half of those areas.

* A teacher's median salary isn't enough to afford a median-priced home in even fewer cities. And licensed practical nurses are priced out of the median-cost home just about everywhere.

* The squeeze is worst in the biggest, most expensive cities such as San Francisco, Washington, Boston, San Diego, Los Angeles and Chicago, but it's a problem in almost every region of the country.

Beginning this month, however, one of the country's highest-volume mortgage originators, Bank of America, is teaming up with the largest mortgage investor, Fannie Mae, to roll out a new targeted-financing concept they call "neighborhood champions" mortgages.

The loan rules are designed to stretch and bend traditional underwriting requirements: Down payments on loans up to $333,700 can be almost zero -- a $500 minimum cash contribution may be all that's needed -- and gifts from relatives, friends or organizations to help with closing costs are freely allowed. Credit standards also will be custom-tailored for community professionals.

This means that young teachers, firefighters or newly minted police officers with scant credit histories and minimal financial assets may be eligible to qualify for a mortgage, when they might not under standard home loan rules.

Borrowers will need to document a favorable 12-month rent payment history and have at least two other records of on-time payments of monthly bills, such as cable TV, utilities or telephone.

Income standards will be more generous than under traditional mortgage lending guidelines. The new program recognizes that many community professionals supplement their regular incomes with sideline jobs -- police with extracurricular employment as private security guards, or teachers with tutoring or working during vacation periods, for example. Applicants will merely have to state where and how much sideline income they earn but not document it with tax filings or other evidence.

The program will attempt to remove as many barriers to home buying for the target workers as possible.

"We want to make sure the professionals who make the neighborhood a better place can live there, too," said Kevin Shannon, Bank of America Consumer Real Estate president.

One early beneficiary of the new program is Debbie Moore, a teacher in the Olathe, Kan., special education system. A single apartment dweller for five years, Moore wanted to buy her own home, but "on my income, I just didn't see how I could possibly afford anything. I didn't even have anything saved for a down payment."

But using a pilot version of the program, Moore was able to credit gift money from her parents toward a down payment and closing costs -- something that traditional loan programs prohibit. Thanks to a good deal on the purchase price, Moore calculates that her two-bedroom, three-bath townhouse has already appreciated by as much as $30,000, giving her not only a home but also an unexpected real estate equity nest egg.

Gwen Thomas, multicultural executive for Bank of America's Consumer Real Estate Group, said borrowers like Moore are excellent candidates for rule-bending. Research has shown that despite their modest salaries, they are excellent credit risks. Once they purchase a house and get a mortgage, they are highly likely to make their monthly payments on time. Unlike many corporate or factory employees, their jobs are not subject to mass layoffs, downsizing and outsourcing to foreign countries.

Thomas said the new program will be available nationally in mid-July. Home buyers who fit into any of the following categories can apply: Full- or part-time teachers; school employees for kindergarten through high school; college and university faculty and employees; full-time police department employees; full-time licensed or accredited medical workers; pharmacists and pharmacy assistants; hospital, nursing facility and doctors' office employees.

More specific eligibility guidance is available by calling 800-900-9000. Buyers can also connect with the program through mortgage brokers and participating real estate brokers.

Kenneth R. Harney's e-mail address is kharney@winstarmail.com.