HUD recently released Notice H 2013-16 to notify owners of properties with a Section 515 Rural Rental Housing loan from the United States Department of Agriculture (USDA) and a Section 515/8 New Construction Housing Assistance Payments (515/8 HAP) contract from HUD that HUD is no longer requiring the submission of annual financial statements (AFS) for these properties. Going forward, owners who purchase a property with a Section 515 Rural Rental Housing loan and a Section 515/8 HAP contract will now execute a revised “Assignment, Assumption and Amendment Agreement of Section 8 Housing Assistance Payments Contract,” which omits the language requiring the purchaser to begin submitting AFS to HUD upon assumption of the HAP contract. What’s more, in an effort to reduce financial burden of submitting multiple AFS, both HUD and USDA have agreed that current owners and those who purchase such properties in the future will now be required to submit annual financial statements only to USDA. This guidance supersedes previous guidance issued by the Office of Asset Management.

Click here to read Notice H 2013-16.