With the subprime market in tatters in the wake of record defaults and foreclosures fewer pitches scream ''Bad credit? No problem!'' Instead lenders struggling to remain profitable are targeting people who have good credit and plenty of home equity. With fewer homes being sold and therefore fewer loans taken out to finance purchases mortgage firms that have survived the subprime shakeout are focusing their marketing on persuading homeowners to refinance. FHA (HUD0 insures then insures the loan and pays the lender if the borrower defaults on the mortgage. The protection offered by FHA mortgages to lenders allows them to be more liberal with their terms than the prospective homeowner might otherwise obtain.
