Most Federal agencies offer a wide range of services. But only a handful also offers products that are competitive in the private marketplace.

HUD is one of those, offering FHA mortgage insurance products that allow buyers to purchase a home, fix-up a home or make a home energy efficient. With low down payments, flexible underwriting and enhanced protections for borrowers, every year hundreds of thousands of buyers - particularly first-time buyers - use FHA-insured mortgages to buy their piece of the American Dream.

As a market-sensitive product, the recent cool down in the housing market has affected FHA activity just as much as it has private lenders. Over the past couple of years, FHA has undertaken a number of streamlining initiatives that, as the market rebounds, should improve its competitive position. But FHA also is looking for new ways to reach new customers.

And that's why it's "going to the 'Net."

For decades, FHA has made use of print vehicles like newspapers and magazines to advertise its products. But almost with each passing month the readership of these traditional - and pretty pricey - media has declined.

So, where have all these potential customers gone? Well, according to a recent survey by the California Association of REALTORS, in 2006 more than 70 percent of homebuyers used the Internet as an "integral tool" in making decisions on when, where and how to buy a home. That's up from less than 30 percent just six years ago.

No wonder, then, that FHA is beginning to go where the buyers are - the Internet. Using FHA marketing and outreach funds, from August 2006 to January 2007, in fact, HUD's Richmond field office conducted Internet advertising campaigns on the Web sites of the Virginia Association of REALTORS, Charlottesville Association of REALTORS, The Virginian Pilot, The Richmond Times-Dispatch and The Roanoke Times.

The results were promising, if not yet definitive. During the campaign, more than 2,500 "clicked through" to a specially-created "3 Percent Yours, 100 Percent Down" Web page offering visitors a comprehensive set of links on how and why to use FHA as their homebuying product of choice.

"Market sensitive products need to go where the market is," explains HUD Richmond Field Office Director William "Bill" Miles, "and, for now, that means the Internet. Given FHA's relatively limited resources, the Internet appears to be a very cost-effective way of reaching people, who by virtue of clicking on our site, have already self-identified themselves as potential customers for the products we offer. We're still only in the early stages of cyber-marketing," he says, "but our initial foray seems to hold real promise."

###