The 5 Most Common Findings on a HUD MOR Audit (And How to Avoid Them)

If you manage a project-based Section 8 property, a Management and Occupancy Review is not an if. It's a when. Your Contract Administrator conducts them on a schedule based on your property's risk rating, and if your last MOR didn't go well, you can count on seeing a reviewer again sooner rather than later. They remember you.

The good news is that MOR findings are almost always preventable. The same problems show up at property after property, year after year. Reviewers are not out to get you. They are, however, required to use the same HUD Form 9834 checklist every single time, which means the things that get flagged are entirely predictable. Knowing what they look for and fixing those things before they arrive is the difference between a Superior rating and a corrective action plan that ruins your November.

Here are the five findings I see most often, and what to do about each one.

1. EIV Policy and Binder Problems

The Enterprise Income Verification system is the single most scrutinized area of any MOR. Reviewers want to see that your staff knows how to use EIV correctly, that access is being managed properly, and that you have a written EIV policy that actually reflects current requirements.

The most common issue is not the policy itself. It's the binder. HUD requires that specific documents live in a designated EIV master file: the current signed EIV policy, all active user access agreements, annual security awareness training records, and system-generated reports like Income Discrepancy and No Income on File. Properties get flagged constantly for having these documents scattered across three different folders, stuffed into a drawer, or last updated during a different presidential administration.

Before your MOR, pull your EIV binder and compare it against the EIV items listed in HUD-9834 Addendum C. If your policy has not been reviewed since before HOTMA, update it now. Reviewers in 2025 and 2026 are specifically checking whether EIV policies reflect the HOTMA asset rule changes, even if your software has not fully rolled out the new calculations yet.

2. Outdated Tenant Selection Plan

Your TSP is the document that governs how you screen and select applicants. It has to stay current with HUD regulatory changes, and a lot of properties are carrying TSPs that are years behind. Some appear to have been written during the Clinton administration and touched only to change the property name.

The findings I see most often: VAWA protections that reference outdated procedures, incomplete language around drug-related eviction exceptions, and no explicit prohibition on admission for anyone convicted of manufacturing methamphetamine on federally assisted property. That last one catches people off guard every time. Federal housing law identifies only two mandatory lifetime exclusions that every TSP must contain: sex offender lifetime registration and meth production on federally assisted premises. Neither allows a lookback period or exceptions. They are not discretionary. If your TSP buries this language in a general criminal history paragraph or skips it entirely, a reviewer will flag it.

One that is tripping people up right now is HOTMA. Your TSP needs to reflect the updated asset rules even though the TRACS 203A software is not live yet. HUD Notice H 2025-07 extended the full compliance deadline to January 1, 2027, but your policy documents are expected to be updated now. A TSP that still describes the old unlimited asset calculation is a finding waiting to happen.

The fix is a line-by-line review against the HUD 4350.3 Chapter 4 checklist. It takes time, but it is considerably less painful than a finding and a 30-day corrective action deadline.

3. Missing or Incomplete Smoke-Free Policy

Per HUD Notice H 2016-08, smoke-free policies are required for HUD-assisted multifamily housing. Every property under a HAP contract needs one in writing. This has been the rule since 2016, and properties are still getting dinged for it, which suggests the memo did not reach everyone.

The finding is not always that the policy is completely absent. More often it exists in the lease but not as a standalone document, or it covers cigarettes but says nothing about e-cigarettes and electronic smoking devices. Sometimes the policy exists, is perfectly written, and staff cannot find it when the reviewer asks for it on-site. That counts too.

Your smoke-free policy should exist as its own document, reference the specific areas covered (all interior spaces, common areas, and within 25 feet of the building), and be distributed to residents at move-in and whenever it is updated.

4. VAWA Form and Documentation Gaps

VAWA findings fall into two categories. The first is operational: are you distributing the right forms at the right times? The second, and one that a lot of properties are currently exposed to, is whether you are using the current versions.

HUD updated four VAWA forms in 2025: HUD-5380, HUD-5381, HUD-5382, and HUD-5383. A fifth form, HUD-5384, was added as a new emergency transfer data collection document. The previous versions have been pulled from HUD's website. If your property is still distributing forms that were printed a few years ago and laminated for safekeeping, there is a reasonable chance they are outdated.

On the distribution side, HUD requires that residents and applicants receive HUD-5380 and HUD-5382 at four specific points: at admission, with any eviction or lease termination notice, upon request, and when a household member is denied a unit transfer. Missing any of these is a finding.

On the policy side, make sure your TSP specifically references lease bifurcation rights and the emergency transfer plan. Reviewers increasingly treat these as standalone checklist items rather than something that can be implied from a general paragraph.

5. Certification Errors and Missing Verification Documents

This is the finding that directly affects your rating because it goes to the core of whether subsidy payments are being calculated correctly. Reviewers pull a sample of tenant files and check the math on each one. They are good at math. Faster than you would expect.

The most common errors: dependent deductions applied to household members who do not qualify, child care deductions calculated incorrectly (the 3% threshold on line 100 applies to medical expenses only, not child care, which is deducted at the full verified amount with no percentage cap), assets mishandled under the new HOTMA $50,000 threshold rules, and anticipated income reported incorrectly for households with zero-income certifications in progress.

The documentation side is just as important as the math. Missing third-party verification, self-certification forms used where they should not be, or verification that expired before the certification effective date are all findings. Reviewers know that documentation is often in the physical file rather than scanned into a system, but they still need to confirm it exists.

The most practical thing you can do before a MOR is pull your last five certifications and check them yourself. A corrected cert before the reviewer arrives is not a finding. The same error discovered by the reviewer is. This is one of those rare situations where doing your own homework is genuinely worth it.

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The Bottom Line

None of these findings require specialized knowledge to catch. They are mostly the result of policies that have not kept up with regulatory changes, binders that have not been organized, and certification math that has not been independently verified. The properties that consistently rate Superior are not doing anything exotic. They are doing the basics thoroughly, on a schedule, before anyone comes to check.

If you want to see how your property's policies and tenant files stack up before your next MOR, that is exactly what HUD Compliance Hub is built for.