Landlords of properties regulated by the U.S. Department of Housing and Urban Development (HUD) know they have to abide by a plethora of fair housing laws and regulations – but are you aware of how to best communicate your compliance to tenants? Proper use of a tenant selection plan can nip public housing and compliance problems in the bud and ensure that you are putting your best foot forward with prospective and new occupants.
HUD’s Tenant Selection Plan Requirements
A tenant selection plan is important for ensuring that tenants are selected for occupancy in accordance with HUD requirements and established management policies. HUD’s stance on tenant selection plans is clear: Except in the case of owners who wish to adopt local or residency preferences, the HUD doesn’t need to approve tenant selection plans.
However, HUD expects owners or property managers to create a tenant selection plan or modify an existing plan in compliance with applicable requirements. For property owners, managers, leasing agents and staff in charge of compliance, understanding the requirements of a tenant selection plan is essential.
The Purpose of the Tenant Selection Plan: Improving Housing Opportunities
According to HUD’s guidance on the topic, found in Chapter 4. Waiting List and Tenant Selection, property owners or managers must have written and publicly available tenant selection policies and procedures. In the form of the tenant selection plan, this must include a number of items such as:
- Project eligibility requirements
- Income limits (including economic mix for Section 8 properties)
- Procedures for taking applications and selecting from the waiting list
- Occupancy standards
- Unit transfer policies
- Policies to comply with Section 504 of the Rehabilitation Act of 1973
- A policy for opening and closing the waiting list, eligibility of students, VAWA protections and confidentiality of information
Owners and managers must especially include in the plan whether there are any restrictions or preferences on renting to elderly tenants, and they should cite supporting documentation to ensure nondiscrimination in the process of tenant selection. Under the HUD’s key requirements of the tenant selection plan, the plan must enable the improvement of housing opportunities and should be reasonably related to program eligibility and an applicant’s ability to perform the obligations of the lease. A correct tenant selection plan must help the owner or manager value and promote nondiscrimination in its tenant selection process.
Ensure Compliance with HUD While Valuing and Promoting Nondiscrimination
In a webinar hosted by AudioSolutionz, “Creating and Understanding a Tenant Selection Plan” with real estate consultant Paul Flogstad, he will discuss how owners and managers can create a good tenant selection plan that is acceptable to HUD and is in compliance with fair housing regulations.
