USDA Rural Housing has some detailed requirements for the homes that get approved for the USDA home loan. All homes will be inspected by an appraiser and must meet the rules before the loan can be closed.
The rules cover the general condition of the home, both outside and inside. The rules also deal with the function of the basic systems like plumbing and electrical.
By enforcing these guidelines and only approving homes that meet certain criteria protects the lender from loaning money on a bad property and also gives the buyer peace of mind that they are getting a decent property.