USDA Homeowner Assistance Available

The U.S. Department of Agriculture (USDA) has made available funds to assist qualified homeowners who are behind on payments because of last year's hurricanes. Homeowners who have financed their homes through USDA Rural Development's Guaranteed Loan Program are eligible.

The new program is called the Mortgage Recovery Advance Program and will allow eligible borrowers to receive a one-time advance from their lender that is enough to make their past-due mortgage payments. Rural Development will reimburse the lender for eligible advances.

Only borrowers who do not currently have the ability to meet their normal monthly mortgage obligations due to a verifiable loss of income, or increase in living expenses due to the hurricanes, are eligible for consideration. No more than 12 months past-due installments, including delinquent principal, interest, real estate taxes and hazard insurance, can be advanced. Borrowers in need of assistance should work directly with their lender to arrange a suitable plan for catching up on their payments.

Section 502 Guaranteed Loans are made to qualifying low- and moderate-income families to purchase modest homes in rural areas. The loans are made by conventional lenders, such as banks and mortgage companies. Loans can be made for up to 100% of the appraised value of the property. Rural Development guarantees the loan made by the lender in case of default by the borrower