FACTBOX: President Bush's subprime aid package

(Reuters) - President Bush on Friday announced reforms of the Federal Housing Administration aimed at saving troubled subprime borrowers from foreclosure. New guidelines from the government mortgage insurance giant should help 240,000 homeowners win more affordable terms for their loans next year, the FHA said. By guaranteeing mortgage payments to lenders, FHA makes it possible for risky borrowers to get more favorable loan terms. Here are some details of the proposal:

- Borrowers who have several months of missed mortgage payments may still qualify for a FHA loan if those delinquencies were only due to a spike in the existing adjustable-rate mortgage.

- A new, risk-based pricing system for FHA insurance will begin January 1 that will charge higher premiums for high risk borrowers but also mean wider access to the program.

- As under the existing FHA terms, borrowers must offer three percent of the loan value in cash or homeowner equity.

- Lawmakers are due to consider comprehensive FHA reform legislation when they return from the summer recess. A reform plan backed by Bush would allow for 100 percent financing and so open FHA insurance to even more subprime borrowers.