The Trainer — February 2013
GETTING REIMBURSED FOR UNIT DAMAGE; RECERTIFYING NEWLY ELDERLY HOUSEHOLDS
In this month’s feature, we discussed how to get reimbursed when former households leave behind unit damage that’s expensive to repair. If the security deposit isn’t big enough to cover the repair costs, you can submit a special claim for damages to HUD. But for your claim to be approved, you must follow certain rules.
In our certification article, we discussed how to respond to a recertification request from a household that newly qualifies as elderly. We explained when an interim recertification is required and what to do.
QUIZ
QUESTION #1
HUD will pay damage claims for households subsidized by any assisted housing program. True or false?
a. True.
b. False.
QUESTION #2
HUD will pay for damage to a unit that was caused by the household’s negligence and abuse, but won’t pay for ordinary wear and tear or routine maintenance. True or false?
a. True.
b. False.
QUESTION #3
HUD caps the amount it will pay you per unit for a damage claim. HUD will pay you no more than:
a. The unit’s contract rent when the household moved out of the unit, less the unit’s security deposit and any money you collected from the household to cover unpaid rent and damages.
b. The unit’s contract security deposit, if the collected security deposit wasn’t enough to cover the damage.
c. The full “reasonable” costs of restoring the unit to occupancy standards, as HUD defines “reasonable.”
QUESTION #4
Which of the following requirements must you meet before HUD will approve your damage claim?
a. You have proof that you collected a security deposit.
b. You can prove that the damage was caused by the household’s negligence and abuse.
c. You can substantiate your costs with invoices, receipts, work orders, etc.
d. You can prove you attempted to collect the debt.
e. All of the above.
f. None of the above.
QUESTION #5
If HUD denies your special claim for damages, you can appeal the denial within 60 days. True or false?
a. True.
b. False.
QUESTION #6
HUD requires households to inform you when a member turns 62 so you can do an interim recertification. True or false?
a. True.
b. False.
QUESTION #7
Under HUD rules, a household qualifies as elderly based on either age or disability. True or false?
a. True.
b. False.
ANSWERS & EXPLANATIONS
QUESTION #1
Correct answer: b
False. HUD will pay damage claims only for Section 8, Section 202/8, Section 202 PAC/PRAC, and Section 811 PRAC subsidized households [Handbook 4350.3, par. 9-14(C)(1)].
QUESTION #2
Correct answer: a
True. But note that contract administrators and local HUD offices may differ on what they consider normal wear and what they consider damage caused by a household’s negligence and abusive behavior. If you’re not sure if a particular type of damage is covered, ask your contract administrator or local HUD office for guidance.
QUESTION #3
Correct answer: a
For example, an owner holds $65, which includes the security deposit and interest earned. The resident leaves owing $300 in unpaid rent and $200 in damages. The owner is unable to collect payment from the resident for rent or damages. The contract rent at the time of the move-out is $400. HUD will pay up to $335 (contract rent minus the security deposit and interest).
QUESTION #4
Correct answer: e
In addition to fulfilling the requirements of answers a through d, HUD also requires that: (1) you didn’t tap your reserve for replacement account to pay for the unit repairs; (2) the household has moved out; and (3) your state and local law permit you to deduct amounts from the security deposit to repair damaged units.
QUESTION #5
Correct answer: b
False. You can appeal the denial, but you have only 30 days in which to do so.
QUESTION #6
Correct answer: b
False. HUD doesn’t require newly elderly households to inform you of this change, and HUD doesn’t require you to do an interim recertification unless you’re informed.
QUESTION #7
Correct answer: a
True. If the household qualifies as elderly based on a member’s disability, you must verify the disability as well as the household’s medical expenses, because it now qualifies for the medical expense allowance.