Pre-HOTMA: an owner could refuse to process a reported income decrease in only two situations, and could delay but never refuse where income would be restored within two months

mfh.recertification.pre_hotma_limits_on_refusing_or_delaying_a_reported_decrease · v1.0.0

SUPERSEDED IN PART -- this is the pre-HOTMA position. Under Handbook 4350.3 REV-1 CHG-4 an owner could refuse to process an interim recertification on a reported decrease in income only where the decrease was caused by a deliberate action of the tenant to avoid paying rent, or where the owner had confirmation the decrease would last less than one month -- and in that second case the owner could choose to process it anyway, provided the policy was applied consistently to every tenant at the property. Where the owner had confirmation that income would be partially or fully restored within two months the owner could delay processing, but not refuse it, and only until the new income was known. While delaying, the owner could require the tenant to keep paying the current rent, but must not evict for nonpayment and must not charge a late fee for paying after the fifth of the month. Once the new income was verified the owner had to recertify, apply any rent reduction retroactively to the first day of the month after the action that caused the decrease, and notify the tenant in writing of any rent due for the delay period. HOTMA replaced this framework at 24 CFR 5.657(c).

Confidence

high

Effective from

2013-11-27

Effective to

2026-12-31

Last reviewed

2026-09-01