What type of properties does USDA not lend on?

The USDA does not lend on farms or properties with income-producing attributes because its rural development loan programs are designed to assist individuals and families in purchasing primary residences in eligible rural areas. The primary goal of USDA loans is to promote home ownership among lower to moderate-income households, thereby supporting community growth and stability.

Properties that are primarily used for commercial purposes, such as farms or those that generate rental income, do not align with this focus. The USDA aims to facilitate home ownership rather than investment in income-generating properties, which are often dealt with through different financing options.

In contrast, residential properties that serve as primary residences, even if they are located on a larger parcel of land, can qualify for USDA loans. Vacant land is not eligible either, but the distinction here lies in the USDA’s commitment to encouraging home ownership rather than investment income. Commercial properties entirely fall outside of the USDA's lending criteria, as they do not meet the requirements of being primary residences for families.