Can a USDA refinance be used to refinance an FHA loan?

The correct choice indicates that a USDA refinance cannot be used to refinance an FHA loan. This is because USDA loans and FHA loans are governed by different programs with distinct eligibility requirements and guidelines. Each loan program has its own specific regulations regarding refinancing, and the USDA does not provide provisions to directly refinance another type of loan, such as an FHA loan.

In contrast, options suggesting that a USDA refinance can be used either universally or under special circumstances fail to align with program rules. The distinction is critical for borrowers to understand, as it emphasizes the importance of choosing the right program based on individual financial needs and circumstances. Additionally, credit score requirements are typically relevant to the loan approval process but do not change the fundamental rules regarding the types of loans you can refinance with a USDA loan.