HUD Changes to Appendix 3 of 4350.3 – Acceptable Forms of Verification

Along with the recent publication of Change 4 to HUD Handbook 4350.3, HUD also amended Appendix 3, Acceptable Forms of Verification. Some of the changes are worth noting, as follows (changes are shown in parentheses):

• Assets disposed of for less than fair market value may now be certified to by the applicant “and or tenant,” and must clearly state that no family member has disposed of assets for less than fair market value in the preceding two years. It also clarifies that only assets disposed of within a two year period prior to “certification or recertification” should be counted.
• Employment Income including tips, gratuities and overtime: For Section 8 properties, “it is mandatory that the EIV Income Report be used as third party verification of employment and income.” This section also reconciles Appendix 3 with Chapter 5 by requiring “4-6” consecutive pay stubs when using stubs as income verification.
• Income maintenance payments, benefits, income other than wages (i.e., welfare, SS, SSI, Disability income, pensions): For Section 8 properties, “it is mandatory that the EIV Income Report be used as third party verification of the Social Security benefit income received.”
• Need for an assistance animal: Letter from “appropriate third party unless the need is readily apparent or already known.” This is important from a fair housing standpoint.
• Social Security Number: HUD now will accept an “original document issued by a federal or state government agency which contains the name, SSN, and other identifying information of the individual.”

HUD also included some additional information on the Appendix 3 as notes that should guide owner efforts with regard to verifications. While these notes were also on the prior Appendix 3, they are worth re-stating:

1. Requests for verification “from a third party source” must be accompanied by a Consent to Release form “HUD-9887-A” (applies to Section 8);
2. If an original verifying document is witnessed but is a document that should not be copied, the owner should record the type of document, any control or serial numbers, and the issuer. The owner should also initial and date this notation in the file;
3. For all oral verifications, file documentation must include facts, time and date of contact, and name and title of the third party; and
4. For use of EIV Income Reports as third party verification of employment and income a current Consent for Release form HUD – 9887 must be on file.