USDA starts mortgage refinancing program, enterprise grant program for rural areas

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The U.S. Department of Agriculture is launching a pilot program to help rural homeowners refinance mortgages to lower monthly payments as part of its "ongoing efforts to help middle-class families, create jobs and strengthen the economy," a USDA press release said. The Single Family Housing Guaranteed Rural Refinance program will operate in 19 states hit hardest by the housing market downturn, and where homeowners have loans that were made or guaranteed by USDA Rural Development.

To be eligible, borrowers must have made mortgage payments on time for 12 consecutive months and the refinanced rates must be lower than original rates. Rural Development expects about 235,000 people will be eligible for the program, which will be reviewed after two years to determine its future. The 19 states are: Alabama, Arizona, California, Florida, Georgia, Illinois, Indiana, Kentucky, Michigan, Mississippi, Nevada, New Jersey, New Mexico, North Carolina, Ohio, Oregon, Rhode Island, South Carolina and Tennessee.

Rural Development is also accepting applications for rural enterprise grants. Funding is available to public bodies, nonprofits and Indian tribes. "The goal is to facilitate and finance the development of small and emerging private business enterprises in rural communities and cities with up to 50,000 in population," reports Megan Kamerick ofNew Mexico Business Weekly. Priority will be given to requests of $50,000 or less and for projects that support renewable energy, local food systems, multi-county or mulit-state economic and community development, cooperatives, business programs in counties with persistent poverty and underserved populations, including minority and women-owned businesses. (Read more)