Navigating affordable housing can feel overwhelming for property management companies. New regulations, compliance requirements, and best practices constantly pop up. One acronym you’ve probably encountered is HOTMA – the Housing Opportunity Through Modernization Act. This 2016 Act brought significant changes to how affordable housing programs operate across the US. But don’t let the official-sounding name scare you off. Understanding HOTMA is crucial for any property manager involved with affordable housing communities.
Table Of Contents:
- Breaking Down HOTMA: What You Really Need to Know
- Conclusion
- Hire the Compliance Expert
- About Jeanie Sanchez and Sanchez Compliance & Consulting
Breaking Down HOTMA: What You Really Need to Know
HOTMA aims to make affordable housing programs across the U.S. more efficient. The Act introduced a whole new layer of regulations property managers have to handle. Property managers must understand these new regulations to ensure compliance.
For a deeper dive, review HUD’s official HOTMA implementation resources, which include notices, timelines, and guidance. If you operate in Texas, the Texas Department of Housing and Community Affairs (TDHCA) offers specific guidance on how HOTMA applies within the state.
Impact on Income Calculation and Eligibility
One of the biggest areas HOTMA changed is how income is calculated to determine tenant eligibility and rent payments. The act encourages a more standardized approach to income determination using third-party verification sources and relying less on paper documentation. This shift requires property managers to update their procedures, potentially investing in new software solutions, to stay organized. These changes aim to make the income determination process more consistent.
Navigating Changes to Tenant Screening Processes
HOTMA also impacted tenant screening processes by adding guidelines concerning criminal background checks, credit history assessments, and the overall selection criteria. The Act aims to make the screening process fairer and prevent discrimination while also ensuring the safety and security of all residents. Property managers must familiarize themselves with these guidelines to create a balance between safety and fair housing opportunities for all applicants.
Understanding Utility Allowance Updates
Another significant aspect of HOTMA involved changes to utility allowances to provide more accurate and fair reimbursements or deductions for tenant-paid utilities. These updates mean more complex calculations for property management companies, who must understand how these allowances are calculated and what documentation needs to be collected for accurate rent calculation and compliance. Failure to comply with these new regulations could result in penalties or legal issues for property management companies.
Conclusion
HOTMA introduced important updates to the world of affordable housing. Some aspects of the Act are complex, so property managers must stay informed about its requirements. By grasping the key elements of HOTMA, like income calculation, tenant screening, and utility allowances, property managers can better serve residents, stay compliant, and create a successful property.
Hire the Compliance Expert
Struggling to keep up with HOTMA’s new rules?
From income calculations to utility allowance updates, the changes brought by HOTMA can overwhelm even experienced property managers. Staying compliant isn’t just about checking boxes—it’s about protecting your properties, your residents, and your reputation.
At Sanchez Compliance & Consulting, we help affordable housing providers confidently navigate HOTMA and other evolving compliance requirements. Whether you need help updating your tenant screening process, understanding income eligibility, or adjusting your utility allowance procedures, we’ll make sure your team is fully prepared.
Let’s build a custom compliance strategy that aligns with HOTMA and keeps your properties on solid ground—no surprises, no last-minute scrambling.
Contact us today to schedule a consultation and get proactive about compliance.
About Jeanie Sanchez and Sanchez Compliance & Consulting
I’m Juanita (Jeanie), and I provide compliance solutions for affordable housing providers. I specialize in managing file review process and backup; delivering greater security, reducing redundancy, and increasing staff understanding.
More technically, I help management agents in applying Section 42 and State Agency requirements, analyze IRS Forms 8609’s and provide guidance on the Multi Building Election, Utility Allowance review and guidance, Pre-State Agency Audit preparation, and Post-State Agency Audit response. I primarily partner with Property Management Companies including:• Owners/Developers• Property Management Companies • Syndicators/Investors• Compliance Managers/Departments• Regional Managers/Onsite Management Teams. When you partner with me (AKA: Sanchez Compliance & Consulting) you get 20+ years of industry experience and the most efficient and consistent compliance solutions that Property Management Professionals are looking for right now. Our primary goal is to minimize your organization’s exposure to possible non-compliance. We are a WBE (Women’s Business Enterprise) Certified by the WBE National Council , WOSB Certified through the SBA and we are a Texas HUB (Historically Underutilized Business), and a proud self declared MWBE. Contact me today and let’s get started!
