Payment cap options on all of Freddie Mac's adjustable rate mortgage programs to allow borrowers to cap payment increases at the time of adjustment and allow lenders to sell loans with negative amortization.

Freddie Mac is also undertaking a three-part study to identify the features that make specific adjustable rate mortgage successful to both the originator and the consumer, Mr. Gray said. The study includes surveys of lenders and real estate agents and some case studies of metropolitan mortgage markets. The information will be available to lenders.

''Again, the time is now -- not tomorrow, next week, or next month -- for institutions that want to survive in the long term to move deliberately toward restructuring their portfolios to bring about a much closer asset-liability maturity match,'' Mr. Gray said.

The adjustable rate mortgage marketing plan Mr. Gray also announced will take the form of a series of workshops and seminars designed to help lenders understand and respond to what Freddie Mac foresees as a growing secondary mortgage market for ARMs. Lastly, the corporation plans to develop and sponsor an advertising campaign promoting adjustable-rate mortgages to lenders, real estate brokers, and builders. For the quarter ended in March, Freddie Mac reported record earnings of about $39 million, up from $26.6 million in the first quarter of this year and $10.2 million in the second quarter of last year. Concerned about increasing default rates on adjustable-rate loans, the nation's mortgage insurance industry has developed new credit limits and increased some premiums to offset their additional risk. Industry leaders said the added risk could eventually boost insurance premiums on adjustable-payment loans by as much as 30% over comparable fixed-payment loans. Most of the nation's 14 mortgage insurance companies have had guidelines for underwriting or checking the creditworthiness of adjustable-rate loans. But competition to attract borrowers has recently heated up, and many lenders have started offering initial discounts on top of below-market rates as they try to qualify borrowers for their loan programs. Initial rates offered in some areas have gone as low as 6%, compared to market rates of 13% and more. That prompted officer's of the Mortgage Guaranty Insurance Co. to launch a campaign to tighten credit limits. Most of the insurance companies have not even published adjustable-rate loan guidelines, and they were just guidelines," said William Lacy, president of MGIC, the nation's largest mortgage insurance company.