Table of content
- HUD MOR Survival Guide 2026: Overview for Project-Based Section 8 Managers
- Key Takeaways
- The “Common Findings” Hall of Fame
- Mastering HUD Form 9834 (Addendum A)
- The Desk Review: The Audit Before the Audit
- The EIV Master Binder Checklist
- Staff Interview Prep
- Maintenance: It’s Not Just a REAC
- HOTMA Update (Breaking News: Jan 2026)
- Are You MOR Ready?
- Frequently Asked Questions (Property Managers)
The Management and Occupancy Review is the deep-dive audit conducted by your Contract Administrator (in Hawaii, typically CGI or HPHA). Unlike a REAC inspection, which checks if the building is standing, the MOR checks if the building is compliant.
A “Below Average” score doesn’t just look bad; it can trigger a flag in HUD’s system, pause your monthly HAP voucher payments, and even threaten your management contract.
At Hawaii Affordable Properties, Inc. (HAPI), our compliance team has survived hundreds of MORs. Here is our “Cheat Sheet” to helping you prepare, survive, and score a “Superior” rating in 2026.
Key Takeaways
- Breaking News: HUD has extended the HOTMA compliance deadline to Jan 1, 2027, but your policies must be updated now.
- The Scorecard: Auditors use Form 9834 Addendum A to grade tenant files. Use it to grade yourself first.
- The #1 Killer: EIV errors account for nearly 50% of all findings.
- The “Curable” Window: You typically have 30 days to fix findings. Do not wait for the final report to start fixing things you know are wrong.
The “Common Findings” Hall of Fame
Avoid the mistakes everyone else makes.
Based on 2024-2025 audit data, these are the top 3 reasons properties fail their MOR.
| Finding Type | The Error | The HAPI Fix |
|---|---|---|
| EIV Existing Tenant Search | Manager failed to run this report before move-in. | This cannot be fixed retroactively. If missing, place a “Memo to File” admitting the error and promising to run it correctly for future move-ins. |
| Citizenship Declaration | Form was signed after the move-in date, or missing entirely. | Audit every file now. If missing, get it signed immediately and current-date it. Do not backdate (that is fraud). |
| Unapproved Lease Addendums | Manager used a generic “House Rules” addendum not approved by HUD. | Check your lease against the HUD Model Lease. If you added a “Pet Addendum” that HUD didn’t sign off on, remove it. |
Master “Form 9834” (Addendum A)
There are no secrets in a HUD audit. The reviewer is required to use HUD Form 9834. If they ask for something not on this form, you can push back.
The Secret Weapon: Addendum A Skip to the back of the form to “Addendum A: Tenant File Review Worksheet.” This is the exact scorecard the auditor uses to grade your files. It asks specific questions like:
- “Is the correct income limit used?”
- “Is the citizenship declaration signed?”
- “Is the move-in inspection dated prior to the lease?”
Two weeks before the auditor arrives, print 5 copies of Addendum A. Pull 5 random tenant files (include a move-in, a recertification, and a move-out). Grade your own files honestly. If you find a missing signature on a 9887 form in one file, assume every file has it missing and launch a property-wide correction immediately.
- Download: Get HUD Form 9834 Here
The “Desk Review” (The Audit Before the Audit)
Before the auditor ever steps foot on your property, they conduct a “Desk Review” using the data you’ve already submitted to HUD. If this data is messy, they arrive looking for problems.
The “Pre-Audit” Checklist:
- Surplus Cash Reports: Does your financial audit match your surplus cash calculation? Mismatches here trigger a “Financial Management” finding immediately.
- AFHMP Status: Is your Affirmative Fair Housing Marketing Plan (AFHMP) older than 5 years? If so, you need to submit a new HUD-935.2A immediately, or at least have proof that you are working on it.
- O/A Certification: Have you submitted your Owner/Agent certification in APPS? If your “Previous Participation” clearance has expired, you will get flagged before the audit begins.
- The Fix: Log into the Secure Systems (WASS) portal 30 days prior and ensure all your contact info and active partners lists are green.
The “EIV Master Binder” Checklist
If you are going to get dinged, it will likely be on EIV (Enterprise Income Verification). This is the most scrutinized area of the audit because it involves sensitive data security.
The “Master Binder” Rule: Do not scatter EIV documents in different folders. You need a central binder containing:
- Owner/Agent Approval Letter: The signed letter authorizing access to EIV.
- UAAF Forms: “User Access Authorization Forms” for every staff member (updated annually).
- Security Training Certs: The “Cyber Awareness Challenge” certificate for every user (must be current within 12 months).
- Income Discrepancy Reports: These must be printed monthly, even if they are blank. If you miss a month, include a “Memo to File” explaining why.
- New Hires Report: Printed quarterly and placed in the master binder.
Staff Interview Prep
The auditor WILL interview your team. Are they ready?
Part of Form 9834 involves interviewing the on-site staff to ensure they actually understand fair housing and occupancy rules.
Common “Gotcha” Questions:
- “How do you calculate medical deductions?” (Staff must know the 3% threshold rule).
- “How do you handle a reasonable accommodation request?” (Staff must know not to ask for medical records, but rather a verification of need).
- “Where is your EIV policy?” (Staff should point directly to the binder, not say “I don’t know”).
HAPI Tip: Conduct a “Mock Interview” with your managers 3 days before the audit.
Maintenance: It’s Not Just a REAC
While the MOR focuses on paperwork, the auditor will walk the property. They are looking for “Exigent Health & Safety” (EH&S) issues.
The “Walk-Through” Checklist:
- Blocked Egress: Are residents storing bikes, shoes, or boxes in the hallways? This is a huge fire code violation.
- Pull Cords: In senior buildings, do the emergency pull cords actually work? Test every single one before the auditor arrives.
- Fire Extinguishers: Check the tags. If they haven’t been inspected in the last 12 months, call your vendor today.
- REAC Follow-Up: Did you fix the deficiencies from your last physical inspection? The MOR auditor will specifically check those items to ensure they didn’t break again.
HOTMA Update (Breaking News: Jan 2026)
Stop Panic Mode: You have more time.
As of January 1, 2026, HUD has officially extended the full compliance deadline for HOTMA Sections 102 and 104 to January 1, 2027.
- What this means: You will not be penalized for “Asset Cap” errors or “Student Financial Aid” calculation errors in your 2026 MOR if your software (TRACS) wasn’t ready to handle them.
- The Trap: However, you MUST update your Tenant Selection Plan (TSP) and EIV Policies now. Auditors are checking if your policies are HOTMA-ready, even if the software isn’t. If your TSP still refers to old asset rules, you will get a finding.
Are You MOR Ready?
Take this 30-second self-audit.
- Is your AFHMP less than 5 years old?
- Do you have 12 months of EIV “Income Discrepancy Reports” printed in a binder?
- Have all adult tenants signed the “Resident Rights & Responsibilities” brochure acknowledgment?
- Is your Tenant Selection Plan updated with HOTMA language?
If you answered “No” to any of these, you are at risk of a finding.
Frequently Asked Questions
What is a "Superior" score?
A Superior score means you had zero findings (or very minor ones) and your files were near-perfect. This rating is rare but valuable—it often means HUD won’t audit you again for 3 years instead of annually.
How often do MORs happen?
Typically annually. However, properties with “Superior” or “Above Average” ratings may move to a 2 or 3-year cycle. Properties rated “Below Average” or “Troubled” may face follow-up reviews within 6 months.
Can I appeal a finding?
Yes. You have 30 days to respond. If you can prove the document existed at the time of the audit but was just misfiled, you can often get the finding removed.
What happens if I fail the MOR?
A “Below Average” or “Unsatisfactory” score can lead to a flag in the Active Partners Performance System (APPS). This can block the owner from receiving new HUD contracts or refinancing the property. This is when owners usually call HAPI for Compliance Audit Recovery.
What is the difference between MOR and REAC?
REAC (now NSPIRE) is a purely physical inspection of the building’s condition. The MOR is an operational audit that checks your tenant files, financial procedures, and management policies. You can pass REAC and fail MOR (or vice-versa).
Drowning in Paperwork?
If your last MOR didn’t go well, don’t wait for the next one.
Let HAPI’s compliance team perform a “Mock Audit” and fix your files before HUD arrives.
