United States Department of Agriculture (USDA) Deputy Under Secretary for Rural Development Justin Maxson announced that the Department is extending the COVID-19 Special Relief Measure for USDA’s Single-Family Housing Guaranteed Loan borrowers.
The USDA COVID-19 Special Relief Measure provides new alternatives for borrowers to help them achieve up to a 20 percent reduction in their monthly principal and interest payments. New options include an interest rate reduction, term extension and a mortgage recovery advance, which can help cover past due mortgage payments and related costs.
Borrowers will first be assessed for an interest rate reduction, and if additional relief is still needed, the borrowers will be considered for a combination rate reduction and term extension. In cases where a combination of rate reduction and term extension is not enough to achieve a 20 percent payment reduction, a third option combining the rate reduction and term extension with a mortgage recovery advance may be used to reach the target payment.
In addition, the Department of Treasury’s Homeowner Assistance Fund (HAF), a critical component of President Biden’s American Rescue Plan, provides $9.961 billion to states, Washington, D.C., territories and Tribes for relief to homeowners impacted by the COVID-19 economic crisis. These funds can be used for assistance with mortgage payments, homeowner’s insurance, utility payments and other specified purposes. Homeowners can access these funds in addition to the payment reduction options discussed above.
For more information, see the White House Fact Sheet: Biden Administration Announces Additional Actions to Prevent Foreclosures.
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