QUESTION 1

Can you let me know what the new procedure is to transfer someone outside the building if they are over income at the current level for their household size?  I have a household in Santa Fe that would like to transfer, however they are currently at approximately $36,000 for a household of two (2) and the guideline is $31, 680.

ANSWER

If the property is 100% affordable you're safe in transferring outside the building as per the IRS. The only time it becomes an issue is when you have market mixed in and you have to watch the Next Available Unit Rule and insure the resident is not 140% income. In this case you will be in compliance to transfer and not have to requalify the resident.

QUESTION 2

Can you tell me does MFA look at any Market unit files or units during an inspection?

ANSWER

Normally no, however if you float the market unit we reserve the right to inspect any of the units.

QUESTION 3

My project based Section 8 property rents are higher than the Tax Credit Gross rents, what rent can I charge?

ANSWER

The answer is listed below in Section 42(g) (2)(B)(i),

42. Low-income housing credit    

( g) Qualified low-income housing project

For purposes of this section—

(1) In general

The term “qualified low-income housing project” means any project for residential

rental property if the project meets the requirements of subparagraph (A) or (B)

whichever is elected by the taxpayer:

(A) 20–50 test

The project meets the requirements of this subparagraph if 20 percent or

more of the residential units in such project are both rent-restricted and occupied by individuals whose income is 50 percent or less of area median gross income.

(B) 40–60 test

The project meets the requirements of this subparagraph if 40 percent or

more of the residential units in such project are both rent-restricted and occupied by individuals whose income is 60 percent or less of area median gross income. Any election under this paragraph, once made, shall be irrevocable. For purposes of this paragraph, any property shall not be treated as failing to be residential rental property merely because part of the building in which such property is located is used for purposes other than residential rental purposes.

(2) Rent-restricted units

(A) In general

For purposes of paragraph (1), a residential unit is rent-restricted if the gross rent with respect to such unit does not exceed 30 percent of the imputed income limitation applicable to such unit. For purposes of the preceding sentence, the amount of the income limitation under paragraph

(1) applicable for any period shall not be less than such limitation applicable for the earliest period the building (which contains the unit) was included in the determination of whether the project is a qualified lowincome housing project.

( B) Gross rent

For purposes of subparagraph (A), gross rent—

(i) does not include any payment under section 8 of the United States Housing Act of 1937 or any comparable rental assistance program (with respect to such unit or occupants thereof)

QUESTION 4

An applicant at a Section 42 property that is in a unique situation. She is filing for divorce at the beginning stages; she has a temporary child support order and a restraining order against the person she is divorcing. This applicants name is still on the deed to the home she and her husband owned together. The husband still resides in the home and pays the mortgage on the home each month. The bank will not verify the real property without a release consent signed by both the applicant and her estranged husband. The applicant again has a restraining order and does not wish to make contact with her husband. Could you please provide some guidance on how to proceed and remain in compliance?

ANSWER

From the HUD 4350.3 REV-1 Exhibit 5-2B.7. page 5.87. “ Assets that are not accessible to the applicant and provide no income to the applicant.   Nonrevocable trusts are not covered under this paragraph. See information on nonrevocable trusts.”

“Example. A battered spouse owns a house with her husband. Because of the domestic situation, she receives no income from the asset and cannot convert the asset to cash.”