USDA Computerizing Loan System for Rural Poor

The Department of Agriculture is automating and centralizing a loan system that serves 625,000 low-income homeowners in rural America.

To accomplish this, the agency purchased Fiserv Inc.'s Dedicated Loan Originations and Servicing software. It will help the department improve on a loan tracking process that had been based on typewritten forms and handwritten index cards.

"It really brings us into the 20th century," said a spokeswoman for the department, which manages an $18 billion portfolio through its Rural Development Bureau.

In a statement, Agriculture Secretary Daniel Glickman said the system will help the agency save taxpayers an estimated $250 million over five years "by computerizing and centralizing the servicing of these loans" and "enabling better tracking of mortgage payments."

Rural Development provides direct home loans to low-income rural families who cannot obtain credit elsewhere. The average family receiving assistance earns less than $15,000 annually.

Fiserv's software will be installed in a St. Louis processing facility slated to handle a host of tasks formerly done in the Department of Agriculture's 1,200 local bureau offices. By the end of 1997, 600 people will be hired to staff the operation, said the agency's spokeswoman.

The new software allows the department to add a host of features, including toll-free phone access to account information, phone access to a live customer service representative 10 hours a day, and an automatic payment service.

Fiserv's mortgage products division also will install software in the St. Louis facility that allows the development bureau to manage its loan portfolio.

New mortgage holders in Missouri and Virginia have already been using the service. New borrowers in other states, as well as existing mortgage holders, will be phased in throughout 1997.

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