What is the characteristic of a USDA non-streamline refinance loan?

A USDA non-streamline refinance loan requires that borrowers meet specific credit requirements. This characteristic ensures that individuals seeking to refinance through this program demonstrate the financial stability and creditworthiness needed to continue managing their mortgage obligations effectively. By imposing these credit requirements, the USDA aims to minimize risk and promote responsible lending practices while allowing homeowners to take advantage of lower interest rates or better loan terms.

The other potential characteristics of this loan option, such as whether an appraisal is required or the ability to finance closing costs, highlight other facets of the refinancing process, but they do not define the foundational requirement of creditworthiness that is central to the USDA's non-streamline refinance procedure. In contrast, features like financing closing costs or recent loan origination do not fundamentally impact the necessity of meeting credit standards, making the focus on credit requirements significant in understanding the USDA loan’s guidelines.