Which of the following statements about eligibility areas is correct?

The correct statement is that properties must be located in areas designated as rural by the agency. The USDA Rural Housing program specifically targets areas that are considered rural under their guidelines. This is designed to help promote homeownership in less populated regions where residents may face challenges in obtaining conventional financing. The agency defines eligible rural areas based on population density and other factors, ensuring that the assistance is focused on those who need it most in rural communities.

In contrast, properties in urban areas generally do not qualify for these loans due to the program's focus on promoting growth and development in rural locations. Additionally, not all areas outside of cities are automatically eligible; some suburban areas may still fall under different classifications that do not meet USDA's rural designation. Likewise, just because a property is located in a small town does not guarantee eligibility; it must still meet the specific criteria set forth by the agency regarding rural designation.