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Option 1  

Properties that meet the following criteria are eligible for a Section 8 contract renewal under Mark-Up-To-Market:

Option 1A

  1. REAC greater than 60 with no uncorrected EH&S violations. 
  2. A most recent MOR score of “Satisfactory” or above.
  3. Rent Comparability Study (RCS) shows the comparable market rents to be at or above 100% of fair market rents (FMR) potential.
  4. The ownership must be:
    1. A profit-motivated entity (including a limited distribution entity);
    2. A housing authority occupying the status of a “public body corporate and politic”; or
    3. A limited partnership with one or more nonprofit general partners or a sole general partner that is wholly owned and controlled by one or more nonprofit entities; or
    4. A limited liability company with one or more nonprofit managers or nonprofit managing members or a sole manager or managing member that is wholly owned or controlled by one or more nonprofit entities where the managing general partner is wholly owned and controlled by a nonprofit entity.
  5. Use Restrictions – The project does not have a low-and-moderate-income use restriction (Review Use Restriction Screen in iREMS).  Example – properties with a Rent Supplement contract or Low-Income Housing Tax Credits.


The Mark-Up-to-Market (MU2M) option provides owners with an incentive to renew Section 8 contracts when a property’s Section 8 rents are lower than comparable market rents.

Submission Requirements:

  • Contract Renewal Request Form (HUD Form 9624)
  • Option One Worksheet 
  • One year Notification to tenant of renewal
  • NEW RCS prepared in accordance with Chapter 9 of the Section 8 Renewal Policy
  • Utility Allowance Analysis, if applicable

Refer to HUD's Section 8 Renewal Policy Handbook for more information, to determine project eligibility and for complete submission requirements.

 

 

Option 1B

This option is for owners who wish to have their rents marked up to market but do not meet the eligibility requirements for an Option 1A.  Under certain circumstances, rents may be increased.  Option 1B requires that properties have at least one of the following conditions at the property: 

  • Vulnerable Populations. The tenants of the property are a particularly vulnerable population, demonstrated by a high percentage (at least 50%) of the units rented to elderly families, disabled families, or large families (large family is defined as a family of five or more persons);
  • Vacancy Rates. The property is located in a low-vacancy market area (or in a rural area with no comparable rental housing) where there is a lack of affordable housing and where Housing Choice vouchers would be difficult to use.
  • Community Support. The property is a high priority for the local community as demonstrated by a contribution of State or local funds to the property. This matching requirement may be in the form of tax abatements, capital improvement funds etc.

Note:  Owners renewing HAP contracts under this option must accept a minimum 5 year contract term.

Submission Requirements:

  • Contract Renewal Request Form (HUD Form 9624)
  • Option One Worksheet
  • One year Notification to tenant of renewal 
  • NEW RCS prepared in accordance with Chapter 9 of the Section 8 Renewal Policy
  • Utility Allowance Analysis, if applicable  



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