Which statement describes a USDA streamline refinance loan?

The USDA streamline refinance loan is designed to simplify the refinancing process for borrowers with existing USDA loans. One of the key features of this type of loan is that an appraisal is usually not required. This significantly reduces the hurdles homeowners might face when trying to refinance, allowing for a quicker and more cost-effective process. By eliminating the need for an appraisal, borrowers can save on associated costs and expedite the refinancing timeline, making it more accessible for those who are currently in a USDA loan.

In this context, there are several relevant aspects why the other options do not apply to streamline refinances. For instance, the requirement to wait two years before refinancing is not applicable to streamline refinances, as these can be accessed sooner if the borrower's loan is current and meets eligibility criteria. Similarly, while traditional refinancing options may have various eligibility requirements, streamline refinances specifically target existing USDA loans, meaning they are meant to be eligible for these borrowers. Regarding the possibility to finance all closing costs and prepaids, although certain loans allow this, the streamlined nature of this refinancing option typically focuses on reducing costs and paperwork rather than increasing financed amounts. Therefore, option C stands out as the defining characteristic of a USDA streamline refinance loan.