Do You Really Have to Wait for Four Check Stubs When Creating an IR for a Resident with a New Job?

As more and more residents return to work, customers are asking how to reduce the time it takes to create an Interim Recertification when the resident's employer will not respond to verification requests.

When a resident gets a new job, there are certain challenges that owner/agents face; the most frustrating is when an employer will not provide 3rd party verification.

In some cases, owner/agents can use the Work Number to verify income from some new employment. However, in many cases, the property staff must rely on third-party verification provided by the resident including:

  • Employment offer letter
  • Payroll summary
  • Check stubs

We find that many property managers wait until the resident can provide the minimum number of payroll check stubs. If you require four check stubs and the resident is paid bi-weekly, then it will be at least eight (8) weeks until verification can be complete. 

Owner/agents are still required to provide a 30-Day Notice of rent increase so it could take as long as three months for the Interim Recertification to be effective. 

You may want to consider a different approach.

Paraphrasing Paragraph 5-13 of HH 4350.3:

  1. The following describes the types of third-party verification in order of acceptability
  2. Upfront-income verification (UIV);
  3. Third-party verification from source (written);
  4. Third-party verification from source (oral); 
  5. Family Certification. An owner may accept a tenant’s notarized statement or signed affidavit regarding the veracity of information submitted only if the information cannot be verified by another acceptable verification method.  In these instances, the owner must document the file why third-party verification was not available. The owner may witness the tenant signature(s) in lieu of a notarized statement or affidavit.

In cases where information 1) is not available using UIV, 2) the resident cannot produce third-party documentation, and 3) the employer will not reply, the owner/agent may use self-certification based on the documentation available.

If the resident has one or two pay stubs, use those pay stubs to project Annual Income. For example:

  • Resident is paid twice per month.
  • Gross income for payroll period 7/15 – 7/31 = $525.
  • Gross income for payroll period 8/1 – 8/15 = $610
  • 525 + 610 = $1135.
  • 1135 / 2 = $567.50 (average income per pay period).
  • 50 x 24 = $13620 (projected annual income).

Owner/agents must document the file and explain why appropriate third-party verification is not included in the file.

The resident must provide notarized or witnessed self-certification of the projected income amount.  The owner/agent - usually the site manager - may witness the resident's self-certification.

If you need additional information about creating Interim Recertifications, including an in-depth discussion of the topic above, see our RBD OnDemand Training HUD's Interim Recertification Process - Changes to Household Composition and HUD's Interim Recertification Process - Changes to Income.

If you need new or updated forms and notices to use when processing Interim Recertifications, check out our RBD FASTForms Package - Interim Recertifications.