Rising mortgage rates might seem like nothing but bad news for those in the market to buy a home. But there may be a silver lining for consumers: When rates change in either direction, many lenders change their product lines.

Lenders typically offer two types of mortgages: a purchase-money mortgage, to be used to buy a home, and a refinance mortgage when rates decline. When rates go up, refinance transactions go down -- why would anyone refi into a higher rate? -- and lenders must replace that lost business.

One way lenders do that is by turning to what’s known as “alternative mortgage” products. And that can be to your benefit.

Today, there are several more products available that might better fit a borrower’s circumstances. And there may be more robust competition among lenders as they beg for your business.

At the recent regional conference of mortgage bankers in Atlantic City, New Jersey, several hundred lenders from the New England and Middle Atlantic states kicked the tires on several alternative products. Those included rehabilitation loans, affordable lending mortgages and so-called “Alt-A” loans -- ones which, for one reason or another, don’t fit into the bucket of products that can be purchased from primary lenders by the federal mortgage agencies (Fannie Mae, Freddie Mac and Ginnie Mae).

It’s worth noting that lenders maintain none of the new variety of alternative loans should be called “subprime,” at least not as they pertain to the poorly underwritten mortgages that exploded a decade ago, resulting in a foreclosure crisis that all but destroyed the national economy.

Today’s non-prime loans have to pass federal underwriting standards put into place to prevent another disaster, specifically the “ability to repay” rule mandated by the Consumer Financial Protection Bureau (CFPB). Simply put, lenders must determine that borrowers have not just the desire to make their payments, but the ability to do so.

(Column intermission: It will be interesting to see if the “ability to repay” rule is swept away by a Trump administration that has little affinity for the CFPB or “unnecessary” regulations placed upon financial institutions.)

One segment of the market in which lenders are starting to exhibit more interest is one where borrowers put up a minimal amount of money out of pocket. These “3 percent down” programs have been around for some time. But with lenders salivating over easy-to-originate refis, they had little time to bother with these paperwork-intensive loans.

Now, with little to no refi business to speak of, they are turning to programs such as HomeReady and Home Possible from Fannie Mae and Freddie Mac, respectively.

Loans like these were designed to expand the mortgage market, especially for low- and moderate-income borrowers who have trouble scraping up enough money for a conventional down payment. In some cases, borrowers may even be able to use money from other sources to help defer the costs of closing charges and fees.

When Home Possible and HomeReady were rolled out almost two years ago, many lenders turned up their noses at them as just two more affordable-housing programs. But now that they are looking for ways to offset lost business, they have discovered the programs have some interesting bells and whistles.

For example, borrowers no longer need to be first-time homebuyers. But best of all, rates are lower than those that Fannie and Freddie charge on their top-tier mortgages.

Another product likely to see increased attention is the Federal Housing Administration’s 203(k) program, which allows the borrower to roll the cost of some home improvements into the mortgage, whether it be a purchase loan or refi.

With these loans, the cost of the improvements is advanced before they are made, and the contractor is paid from the loan proceeds. Consequently, the borrower does not need to take out two mortgages -- one likely at a far higher rate -- for the expenses.

The ideal customer for a 203(k) is an investor or wannabe homeowner with his or her eye on a clunker of a house, a fixer-upper, at a good price.

And then there’s the category of loans known as “non-Q” mortgages. These are loosely defined as loans to borrowers who pass the ability-to-pay test, but who have some characteristics -- poor credit scores, for example -- that make their loans ineligible for sale to Fannie, Freddie or Ginnie. These include jumbo loans that are above the maximum amount Fannie and Freddie can purchase, loans to investors who own more than 10 properties, loans to foreign nationals and loans to “challenged borrowers” who have suffered through a recent housing event such as a divorce, major illness or foreclosure.

In other cases, some lenders are starting to court investor-borrowers who fix and hold houses, as opposed to fix and flip. The borrower need not necessarily be an experienced investor, but could rather be a first-time property rehabber. The cost is a little higher and the loan has a shorter term. But once the borrower can exhibit a history of being a successful landlord, he or she can always refinance into a standard 30-year mortgage.

-- Freelance writer Mark Fogarty contributed to this report.

All military personnel are told about their Department of Veterans Affairs (VA) housing benefits when they muster out of the service. But far fewer seem to be aware of their second-tier entitlements: the fact that they can use their no-down-payment mortgage benefit more than once.

There are rules, of course. Aren’t there always? But if you are a qualifying veteran, it’s possible to buy a second house with a VA loan while you still have your first VA-mortgaged house. You might even be able to use your second-tier benefits to buy another house after you’ve lost your first one to foreclosure or a short sale.

It shouldn’t come as a surprise that most veterans are unaware of what their second-tier benefits are. A recent check with several lenders at a trade show found that most lenders -- even those who claim a specialty in VA lending -- don’t know much about them, either.

But there are at least a few people out there knowledgeable on the subject. One is Joe Murin, a former president of Ginnie Mae under presidents Bush and Obama. Ginnie Mae is the little-known government-sponsored enterprise that buys government-backed mortgages from primary lenders, then packages them into securities.

Another expert is John Burke, a loan officer at Great Plains National Bank in Austin, Texas. Burke’s website (VAloansdoneright.com) explains VA loans in great detail.

Murin, now vice chairman at Chrysalis Holdings, which includes companies in the analytics and mortgage sectors, says “most people don’t even know that second-tier entitlements exist. A lot of veterans don’t even know they have first-tier benefits.”

With that in mind, let’s start with the basics: The VA doesn’t make loans itself. Rather, it guarantees loans made by local lenders to service members, veterans and eligible surviving spouses who want to buy a house. (You can find out if you’re eligible at benefits.va.gov/homeloans/purchaseco_eligibility.asp.)

There are limits, though. The most a veteran can borrow anywhere in the country without any money out of his or her own pocket is $424,100. But there are some 50 counties, largely on the coasts, where the maximum is considerably higher. For every $4 borrowed above the maximum, however, the vet must put up $1.

The VA’s guarantee is limited to the lesser of 25 percent of the county loan limit or 25 percent of the loan amount. So, if the borrower has his full entitlement and is buying a $300,000 house in a county where the loan limit is $424,100, the VA will guarantee $75,000 and the lender will not require a down payment.

Later, if he pays off the old loan and buys another house with a VA loan, the full entitlement will be restored. If he then buys, say, a $400,000 house in a county with the standard limit, the VA will guarantee $100,000 of the loan amount and, again, a down payment should not be necessary.

Second-tier entitlements normally come into play when a service member transfers duty stations: If a soldier has a VA loan on a house at her current post and wants to buy a house at her new one, she can use her remaining entitlement on the new house.

Typically in these cases, the new post is temporary, or the service member intends to keep the old place as a rental. Either way, the borrower’s debt-to-income ratio will be scrutinized to make sure she can handle the payments on two houses. And if the old house is rented instead of sold, the borrower will be required to produce a lease that spells out the rental terms and amounts.

Since the maximum guarantee entitlement in counties with a ceiling of $424,100 is one-quarter of that amount ($106,025), the veteran borrower in the above example (who used $75,000 of his entitlement on his first house) would still have $31,025 available.

“Just because he’s tied up with a prior VA mortgage doesn’t mean he can’t have another one,” says Burke.

Of course, veterans in this scenario can borrow more than the remaining entitlement amount; they’ll just have to pony up some of their own money. And if the county limit where they’re buying their next house is higher -- say, $815,000 -- the maximum guarantee goes up as well ($203,750), along with the remainder available.

There are a couple of caveats: Borrowers must have been current on payments for the previous 12 months, and must meet the lender’s debt-to-income ratios.

Now suppose a vet bought a house with a no-money-down VA loan, using part of his entitlement. If he lost that house in a distress sale, that portion of his entitlement would be gone. But he would still have the remainder, meaning he would be eligible -- if he passed the necessary waiting period and re-established a clean credit record -- for another partial VA loan with nothing down.

VA borrowers also can use their second-tier entitlements to buy larger houses for their expanding families and to bring their elderly parents or grandparents into their homes.

For more on this admittedly complicated topic, find a lender that is an expert in VA financing or contact your local VA Regional Loan Center.

Parents who would like to see their adult children leave the nest are increasingly buying their offspring their own places.

Once upon a time, Mom and Dad would wait until their kidlets were starting their own families to help them buy a house or apartment, if they offered any help at all. But now, that kind of assistance is coming earlier and earlier -- and continuing longer and longer.

Leonard Steinberg, president of the New York real estate chain Compass, sees this trend as the vanguard of an enormous shifting of assets that will happen over the next 20 years, as wealth accumulated by baby boomers is transferred to their heirs.

How much wealth? A staggering $30 trillion, Steinberg says, adding that it will be “the greatest transfer of generational wealth ever.”

And this isn’t an isolated occurrence -- it’s a real trend, says Steinberg. As an example: Parental deals benefitting their children make up 21 percent of activity at one of Compass’s buildings in New York’s booming Lower East Side.

While the trend is nationwide, Steinberg says it is more concentrated among larger cities where the cost of renting is sky-high. The reasoning: Why waste enormous amounts of money on rent -- a “reckless” expenditure, in Steinberg’s words -- if a parent can help a child get started in homeownership instead?

Hopefully, doing so will give the children a leg up on all the financial benefits from building equity, and foster values necessary to homeownership, like commitment. It also helps grown kids who have gotten themselves into the financial netherworld of bad credit -- perhaps due to the burden of scholastic debt -- or who have no debt, or credit history, at all. In those cases, their debt-to-income ratio is either so high or so nonexistent that it’s all but impossible for them to qualify for financing on their own.

It may sound as though this kind of maneuver is the exclusive province of millionaires, but Steinberg says he sees it over all niches of wealth. “A $50,000 cash infusion can make all the difference,” he says, and can help an adult child make as much as a $50 million investment.

In New York City, parents are buying their children all manner of housing, from condominiums and co-ops to semi-detached homes and brownstones. In Manhattan, the property is likely to be an apartment. But in the outer boroughs, you can still find a brownstone for $700,000 to $800,000 -- and, of course, into the millions.

According to The New York Times, assistance for kids who’ve left the nest comes largely in the form of helping with rent and other living expenses. And the amounts can be substantial.

Some 40 percent of 22- to 24-year-olds receive financial help from their parents, at an average of $3,000 per year. Children working in the arts and design fields get the most help, typically $3,600, while those in blue-collar trades and the military receive the least, about $1,400. More than half the young adults working in arts and designs get parental aid, but only 29 percent of those working in personal services get such help.

In real estate, the child beneficiary is usually an adult, but he or she can be of any age. Steinberg says his Compass clients have bought property for children as young as 12. In those cases, the parents rent out the property until the child is old enough to have his own place.

For some parents, that time can’t come soon enough: According to a Money magazine survey, adult children expect to be financially independent at age 27, while most moms and dads expect them to hit that landmark by age 25.

-- Freelance writer Mark Fogarty contributed to this report.