The Trainer — September 2013
TRANSFERRING HOUSEHOLDS; CERTIFYING HOUSEHOLDS WITH FULL-TIME STUDENTS
In this month’s feature, we discussed what steps to take when transferring households from one unit to another. If you don’t take the proper steps and document your actions, you might be liable to HUD for billing errors.
In this issue’s Certification article, we explained how to handle the income of full-time students when certifying or recertifying households. If you don’t know the specific rules, it’s easy to make mistakes.
QUIZ
QUESTION #1
When a household transfers from one unit to another, you can simply make handwritten modifications to the lease for the move-out unit and have the appropriate household members sign it. True or false?
a. True.
b. False.
QUESTION #2
When you transfer a household to a new unit, you must change how you bill HUD for the rent it pays for that household’s unit. HUD’s rules say you must stop billing for the move-out unit as of the day before the transfer date, and start billing for the move-in unit on the unit transfer date. Because you bill HUD by submitting a voucher one month in advance, you’ll have already billed HUD for the entire month of the move by the time the household moves. If you’ve overcharged HUD as a result, you can bill HUD less in the next voucher. True or false?
a. True.
b. False.
QUESTION #3
You may not charge a transferring household a new security deposit; you must transfer their existing security deposit when they move to the new unit. True or false?
a. True.
b. False.
QUESTION #4
The transferring household, not the site, must always pay for the move to the new unit. True or false?
a. True.
b. False.
QUESTION #5
Tonya Thompson is a 20-year-old who lives with her parents at your site. She’s a full-time student at a local college and has a part-time job. She expects to earn $4,000 over the next 12 months. When calculating the Thompson’ household income, you should exclude all of Tonya’s income over what amount?
a. $350.
b. $380.
c. $480.
d. $500.
QUESTION #6
When calculating household income, you shouldn’t count the financial assistance a student member of the household receives. True or false?
a. True.
b. False.
QUESTION #7
When calculating household income, you shouldn’t count the benefits or other unearned income of a full-time student. True or false?
a. True.
b. False.
ANSWERS & EXPLANATIONS
QUESTION #1
Correct answer: b
False. You and the household must sign a new lease and any applicable lease addendums for the new unit [Handbook 4350.3, par. 6-5(B)(3)]. You aren’t allowed to just make handwritten modifications to the lease covering the move-out unit. You and the household must also sign the 50059 when you sign the new lease.
QUESTION #2
Correct answer: a
True. When you record the unit transfer with your TRACS-compliant software, the software should automatically adjust your site’s next monthly voucher to accommodate HUD’s rules on billing for unit transfers. But be sure to check your next voucher before you mail it to HUD or your contract administrator and confirm that the software accurately adjusted the billing to account for the transfer.
QUESTION #3
Correct answer: b
False. In a unit transfer, HUD says you may charge a new and different security deposit or transfer the security deposit from the move-out unit to the move-in unit [Handbook 4350.3, par. 6-16(A)]. It’s up to you. If you collected the appropriate security deposit when the household moved to the site, you won’t jeopardize your right to make special claims for unpaid rent or damages by not asking for a new deposit. But collecting a new security deposit may give you greater protection if the household damages the unit. You’ll need to weigh this benefit against the administrative cost of requiring new security deposits for transfers.
QUESTION #4
Correct answer: b
False. The site may have to pay for the move if you’re letting a household transfer units as a reasonable accommodation of a disability [HUD Handbook 4350.3, par. 7-16(B)(2)]. If a tenant is transferred as a reasonable accommodation to a household member’s disability, then the owner must pay the costs associated with the transfer, unless doing so would be an undue financial and administrative burden. In these situations, you should ask your attorney for advice.
The handbook also isn’t clear about who must pay for other types of unit transfers—for example, when a household must move because its unit size isn’t appropriate for the household. Often, the household pays for the move. But because the handbook isn’t clear, to be on the safe side, ask your contract administrator or local HUD office whether you or the household must pay for the move.
QUESTION #5
Correct answer: c
Students who go to school full time are entitled to have earned (employment) income above $480 excluded from the household’s annual income if the student is 18 or older and isn’t the household head, co-head, or spouse [HUD Handbook 4350.3, par. 5-6(a)(3)(d)]. To qualify as “full time” under HUD rules, the student must carry a subject load considered full time by the school’s standards.
QUESTION #6
Correct answer: a
True. You must exclude all financial assistance to any student, whether full time or part time. Student financial assistance includes grants, scholarships, educational entitlements, work-study programs, and financial aid packages. This is true whether the assistance is paid to the student or directly to the educational institution [HUD Handbook 4350.3, par. 5-6(E)]. However, for students receiving Section 8 assistance, all financial assistance a student receives that’s in excess of amounts received for tuition is included in annual income except if the student is over the age of 23 with dependent children or the student is living with his or her parents who are receiving Section 8 assistance [HUD Handbook 4350.3, par. 5-6(E)].
QUESTION #7
Correct answer: b
False. You must count a full-time student’s unearned income from all sources listed in Exhibit 5-1 of Handbook 4350.3. For instance, if a full-time student gets monthly Social Security income or child support payments from an ex-spouse, you must include these payments in household income [Handbook 4350.3, par. 5-6 (A)(3)(b)].