USDA Rural Housing Service Administrator Tony Hernandez today announced a series of changes that will make it faster and cheaper for homeowners to refinance USDA mortgages.
“These changes reaffirm the Obama Administration’s commitment to middle-class Americans, and I am pleased that we continue to provide affordable housing to support thriving economies in rural communities,” Hernandez said. “Helping homeowners refinance their homes to reduce their monthly payments and take advantage of low interest rates will bring increased capital to rural residents and the communities where they live and work.”
The changes apply to mortgages issued through USDA and those where USDA has issued a loan note guarantee. They take effect June 2, 2016.
Homeowners current on their mortgages for the past 12 months will no longer be required to secure an appraisal, provide a credit report or undergo a debt-to-income calculation when they refinance for a 30-year term. These changes will save time and money.
USDA began testing these changes in a 2012 a pilot program that was later expanded to include 34 states and Puerto Rico. To date, nearly 9,500 homeowners have refinanced their mortgages. Some borrowers saved as much as $600 a month. The average savings is around $150 per month.
The streamlined rules are consistent with banking industry lending standards. These refinanced loans, like all USDA Rural Development housing loans, meet rigorous underwriting standards and are made only to qualified borrowers. The Department of Housing and Urban Development and Department of Veterans Affairs have similar programs for the Americans they serve.
Interested homeowners with USDA loan guarantees should contact their lender about refinance procedures. Homeowners with USDA Direct loans should contact a USDA housing specialist.
For additional details on these new changes, please see page 26461 of the May 3 Federal Register. To learn more about South Dakota USDA housing programs, please contact a housing specialist at:
For guaranteed rural housing loans, contact an approved lender (Most mortgage lenders in South Dakota are approved) or contact Guaranteed Rural Housing Specialist Kenneth Lynch, ken.lynch@sd.usda.gov, or (605) 226-3360, Ext. 4 for more information.
For further information on the direct programs, please contact one of the following Housing Specialists:
Aberdeen Area Office - Roxanne Woodring, roxanne.woodring@sd.usda.gov, or 605-226-3360, Ext. 4, servicing Beadle, Brown, Campbell, Day, Edmunds, Faulk, Marshall, McPherson, Roberts, Spink, and Walworth.
Mitchell Area Office - April Norton, april.norton@sd.usda.gov, or 605-996-1564, Ext. 4, servicing Aurora, Bon Homme, Charles Mix, Clay, Davison, Douglas, Hanson, Hutchinson, Jerauld, McCook, Sanborn, Turner, Union, and Yankton.
Pierre Area Office – Grady Olson, grady.olson@sd.usda.gov, or 605-224-8870, Ext. 4, serving Brule, Buffalo, Corson, Dewey, Gregory, Hand, Hughes, Hyde, Jones, Lyman, Mellette, Potter, Stanley, Sully, Todd, Tripp, and Ziebach.
Rapid City Area Office – Lance Lockwood, lance.lockwood@sd.usda.gov, or 605-342-0301, Ext. 4, serving Bennett, Butte, Custer, Fall River, Haakon, Harding, Jackson, Lawrence, Meade, Pennington, Perkins and Shannon.
Watertown Area Office - Diane Byer, diane.byer@sd.usda.gov, or 605-886-8202, Ext. 4, serving Brookings, Clark, Codington, Deuel, Grant, Hamlin, Lake, Lincoln, Kingsbury, Miner, Minnehaha, and Moody.
USDA Rural Development in South Dakota has offices in Aberdeen, Huron, Mitchell, Pierre, Rapid City, Sioux Falls, Watertown, and Yankton. For more information, visit the USDA Rural Development Website at http://www.rd.usda.gov/sd.
Since 2009, USDA Rural Development (#USDARD
) has helped 1.1 million rural residents buy homes; invested $11 billion to start or expand 103,000 rural businesses; funded nearly 7,000 community facilities such as schools, public safety and health care facilities; financed 185,000 miles of electric transmission and distribution lines; and helped bring high-speed Internet access to nearly 6 million rural residents and businesses. For more information, visit www.usda.gov/results.