All households receiving HOME assistance must be income-eligible. Therefore, the income certification process must be completed before assistance begins -- at very the latest.
There are two distinct times when income certifications may be necessary for households participating in HOME-funded programs:
- Initial income certifications, and
- Annual income recertifications.
Households must qualify as low income at the time of occupancy or at the time HOME funds are invested, whichever is later.
The HOME Program does not require a PJ to re-examine a household's income at the time HOME assistance is provided, unless more than six months have elapsed since the household's income was certified by the PJ.
A preliminary determination of eligibility probably can (and should) be made much earlier. Because application processing is labor intensive, early screening for income eligibility can eliminate excessive work in processing eligible applicants.
For example, when considering an application from a developer to rehabilitate an existing rental project, it is important for a PJ to know whether the current tenants will continue to be eligible once the HOME funds are invested in the project.
Establishing a deadline for the completion of income certifications can be a challenging part of the planning process.
- Because income determinations involve the collection of information from applicants and/or third parties, waiting too long can delay a project.
- Conducting income certifications too early in the process, however, might mean that certifications become outdated and must be redone.
Generally speaking, the HOME Program permits income verifications dated no earlier than six months prior to certification.
Income Certifications for Lease-Purchase or Contract-to-Purchase Housing
PJs have some flexibility when certifying the income of homebuyers in lease-purchase or contract-to-purchase programs. Homebuyers are required to qualify as low-income:
- In the case of a contract to purchase existing housing, at the time of purchase;
- In the case of a lease-purchase agreement for existing housing or for housing to be constructed, at the time the agreement is signed; or
- In the case of a contract to purchase housing to be constructed, at the time the contract is signed.
Annual Income Recertifications
In addition to the initial income certifications performed when applicants are determined eligible to receive HOME assistance, there are two situations in which households must have their income recertified on an annual basis:
- when tenants receive HOME tenant-based rental assistance; and
- when tenants occupy HOME-assisted rental units.
Because new income certifications should be effective on each tenant's "anniversary date" (one year from the start of assistance or their last recertification date), the income certification process should begin 60 to 90 days prior to that time.
Rental Housing Recertifications
For HOME-assisted rental housing projects only, the HOME Final Rule allows a PJ to use one of the following three methods to recertify tenant incomes. All other types of HOME assistance require the use of method one only.
- A review of source documentation, as is done for a household's initial eligibility determination.
- A written statement from the household, indicating their household size and annual income. This statement must include a certification from the family that the information is
- complete and accurate, and
- source documents will be provided upon request.
A sample household certification form is provided in the HOME Front's Sample Forms module.
- A written statement from the administrator of another government program under which the household receives benefits and that examines the annual (gross) income of the household each year. The statement must also indicate the family size, or provide the current income limit for the program and a statement that the family's income does not exceed that limit.
A sample government administrator certification forms is provided in the HOME Front's Sample Forms module.
If the PJ chooses to allow rental project owners to accept the written statement from the household or other governmental entity for income recertification, it must require owners to review full source documentation every sixth year of the affordability period.
For example, in a rental project with a 20-year affordability period, source documentation must be used to certify all tenants' income at initial lease-up, and in years six, twelve, and eighteen of the affordability period. For the other years, a family or government program statement may be used.