The Agriculture Department will try to help U.S. farmers and rural businesses survive the recession by offering loan restructuring and low-interest loans as needed, Agriculture Secretary Tom Vilsack said Aug. 10.
Vilsack said USDA would use its authority to maximize relief to borrowers. It sent a letter to borrowers to outline options including loan rescheduling, reamortization, deferral of payments and debt reduction.
In addition, USDA encouraged lenders that use USDA loan guarantee programs to use all options to assist struggling producers. The options are similar to those offered under land ownership and farm operating loans made by USDA.
Lenders also can encourage borrowers to apply for low-interest loans directly from USDA. Up to $300,000 can be borrowed in an operating loan and in land ownership loans.
For businesses in rural areas, USDA said it would modify its Business and Industry loan guarantee program to cover a larger portion of the loan, to reduce loan fees and eliminate the annual fee charged to lenders to maintain the guarantee.
USDA said it would consider adjustment in loan terms as part of a comprehensive loan stabilization plan.
“Not only is this effort critical to restoring economic prosperity in America’s rural communities, it is essential to ensure that Americans continue to have access to a safe, secure and healthy food supply,” said Vilsack in a statement.