HUD Handbook 4350.3 § 3-18
Eligibility Requirements for Admission to Elderly Projects, By Program (HUD Occupancy Handbook 4350.3 REV-1 CHG-4)
HUD guidance — not codified law
In Force
Verified 9/24/2026 · Next check 10/1/2026
effective 9/24/2026FederalSection 8 HCVOperative Text
HUD Handbook 4350.3 § 3-18
Type Covered by Title VI, Subtitle D of the Housing and Community
Development Act of 1992
Title VI, Subtitle D of the Housing and Community Development Act of 1992 (Title VI-D)
authorizes owners to establish a preference for elderly families in certain Section 8
assisted properties that were designed primarily for occupancy by elderly families if
certain requirements are met. Title VI-D also permits owners of certain other federally
assisted properties that were designed in whole or part for the elderly to continue to
restrict occupancy to elderly families in accordance with the rules, standards, and
agreements governing occupancy at the time of development of the project if certain
requirements are met. While owners must comply with all relevant sections pursuant to
Title VI-D, owners should pay close attention to Sections 651 and 658 with respect to
eligibility and tenant selection. Section 3-18 A provides guidance on the optional elderly
preference for covered Section 8 properties. Section 3-18 B provides guidance on
restricting occupancy to elderly families in other federal assistance programs.
A. Owner-Adopted Preferences for Elderly, Disabled, Nonelderly Disabled, and
Near-Elderly Disabled Families
Section 651 of Title VI, Subtitle D of the Housing and Community Development
Act of 1992 permits owners of “covered Section 8 housing projects” designed
primarily for occupancy by elderly families to adopt a selection preference for
elderly families. An owner may, but is not required to, implement this preference.
If the owner adopts the preference, it must be implemented in accordance with
the rules described in this paragraph.
1. Applicability. Owners of properties assisted through the following
programs (insured and non-insured) are eligible to implement this
preference:
a. Section 8 New Construction;
b. Section 8 Substantial Rehabilitation;
c. State Housing Agency programs for Section 8 New Construction
and Substantial Rehabilitation;
d. Rural Housing 515/8; and
e. Section 8 Property Disposition Set-Aside (applies only to
properties that involve substantial rehabilitation).
2. Definitions. The following definitions are used when implementing this
preference:
a. An elderly family is one in which the head of the household, co-
head, or spouse is at least 62 years of age. (See Figure 3-6,
Definition A.)
b. A near-elderly family is a family whose head, spouse, or sole
member is a person with disabilities who is at least 50 years of
age, but below the age of 62; or two or more persons with
disabilities who are at least 50 years of age but below the age of
62, living together; or one or more persons who are at least 50
years of age but below the age of 62, living with one or more live-
in aides.
c. A nonelderly disabled family is one in which the head of the
household, co-head, or spouse is disabled and 18 to 49 years of
age. (See Figure 3-6, Definition D.)
3. Owners must be able to demonstrate that the property was originally
designed for occupancy primarily by elderly families to implement an
elderly preference. Owners must be able to produce one primary source
of information or two secondary sources of information showing that the
project was intended to house elderly families.
a. Primary sources: Identification of the project (or portion of the
project) as serving elderly families should be documented in at
least one primary source such as:
(1) The application submitted in response to the notice of
funding availability;
(2) The terms of the notice of funding availability under which
the application was solicited;
(3) The regulatory agreement;
(4) The loan commitment;
(5) The bid invitation;
(6) The owner’s management plan;
(7) Any underwriting or financial document collected at or
before loan closing; or
(8) Application for Mortgage Insurance
b. Secondary sources. If an owner does not have at least one
primary source, two or more secondary sources of evidence may
be used such as:
(1) Lease records from the first two years of occupancy for
which records are available showing that occupancy has
been restricted primarily to households where the head,
spouse, or sole member is 62 years of age or older;
(2) Evidence that services for elderly persons have been
provided, such as services-funding by the Older Americans
Act, transportation to senior citizen centers, or programs
coordinated with the Area Agency on Aging;
(3) Project unit mix with more than 50% of efficiencies and
one-bedrooms; and
(4) Other relevant historical data, unless clearly contradicted
by other comparable evidence.
c. Sources in conflict.
(1) If one primary source is contradictory to another primary
source used to establish the use for which the project was
originally designed, the owner cannot make the election of
preferences for elderly families based upon primary
sources alone.
(2) In any case, where primary sources do not provide clear
evidence of original design of the project for occupancy
primarily by elderly families or when primary sources
conflict, secondary sources may be used to establish the
use for which the project was originally designed.
(3) In the event that HUD staff is requested to make a decision
based upon “totality of circumstances”, HUD staff should
thoroughly research HUD records prior to making such a
decision. If there is uncertainty regarding the weight of the
available source documents used for determining eligibility,
HUD staff must render a decision that the project was not
designed primarily to serve the elderly.
4. An owner is not required to obtain approval from HUD prior to
implementing the elderly preference. Although the owner is not required
to submit documentation to HUD prior to implementing the elderly
preference, an owner must provide the documentation as evidence of
eligibility to apply the preference upon HUD’s request.
5. When implementing the preference, an owner must:
a. Notify nonelderly families on the waiting list of the decision to
implement this preference and of the impact the decision will have
on nonelderly families on the waiting list.
b. Reserve a percentage of the units for occupancy only by disabled
families or individuals who are neither elderly nor near-elderly
(collectively referred to as “nonelderly disabled persons/families”)
that is equal to the lesser of:
(1) The higher of the percentage of units occupied by
nonelderly disabled families on (i) January 1, 1992, or (ii)
October 28, 1992; or
(2) 10% of the total number of units in the project.
NOTE: Although the reservation of units is capped at 10% of the
total number of units, the owner can exceed the 10% cap as long
as the units exceeding the cap are leased in a nondiscriminatory
manner.
Example – Establishing the Number of Units for Nonelderly Persons with
Disabilities
An owner has a covered Section 8 housing property with 100 units. On January 1, 1992,
nonelderly persons/families with disabilities occupied 10 of the units. On October 28, 1992,
nonelderly persons/families with disabilities occupied 20 units.
A. The owner would have to compare the number of units occupied by
nonelderly disabled persons/families on January 1, 1992, (10 units) with the
number of units occupied by nonelderly disabled persons/families on
October 28, 1992, (20 units) and use the higher number. In this case, it
would be 20 units.
B. 10% of 100 units = 10 units
To obtain the percentage or number of units that must remain available for nonelderly
disabled persons/families, the owner must take the number of units determined above for
Item A (20 units), compare with Item B (10 units), and use the lower number for the
number of units that must be reserved.
Therefore, Item B is less than Item A, and the owner must reserve 10 units for occupancy
by nonelderly disabled persons/families.
Note: If an owner determines that there were no nonelderly persons occupying units on
those two dates, the required number of units to be reserved for nonelderly persons with
disabilities can be zero (0).
6. If an owner exceeds the established number of units and leases
additional units to nonelderly disabled families and the units later become
available for occupancy, the owner may fill the vacancies with elderly
families/persons, as long as the established set-aside percentage of units
is met.
7. The set-aside number of units for nonelderly disabled families is not unit
specific. A nonelderly disabled family may occupy a unit without
accessible design features. Elderly families may occupy any unit as long
as the set-aside number of units for nonelderly persons with disabilities is
preserved.
8. Owners may exceed the set-aside number of units for nonelderly disabled
families and are encouraged to do so if the need exists in the community.
Owners who exceed the set-aside number of units are not required to
continue to exceed the set-aside number of units.
9. If there is an insufficient number of elderly families available to fill the
units designated for elderly families, owners may establish a preference
for near-elderly persons with disabilities for these units.
10. If there is an insufficient number of nonelderly disabled families available
for the units designated for nonelderly persons with disabilities, the owner
may establish a preference for near-elderly persons with disabilities for
these units.
11. If there are an insufficient number of near-elderly disabled families
available, the owner shall make units generally available for occupancy
by families who have applied and are eligible, without regard to
preferences.
12. Elderly Restriction at RHS Section 515/8 Projects. Owners of RHS
Section 515/8 projects designated as elderly are limited to housing elderly
persons or persons with disabilities meeting the Definitions A, D or E in
Figure 3-6. Age restrictions cannot be waived at these projects. If there
is an insufficient number of eligible applicants and the owner wishes to
house persons who do not meet the elderly or disabled eligibility
requirements in Figure 3-6, the owner must request RHS to reclassify the
project designation from elderly to family. In cases where RHS has
determined there is no longer a demand for the elderly units in the
community where the project is located and changes the project
designation to family, HUD or CA should consult with Legal Counsel to
determine if there is a need to amend the assistance contract.
B. Owner-Adopted Elderly Restrictions in Certain Federally Assisted Housing
Projects that were Designed to Serve the Elderly
Section 658 of Title VI of Subtitle D of the Housing and Community Development
Act of 1992 (HCDA) permits owners of certain federally assisted projects to
restrict occupancy in such projects (or portions of projects) to elderly families in
accordance with the rules, standards, and agreements governing occupancy in
effect at the time of the development of the project.
1. Applicability. Only owners of properties that were originally designed for
the elderly and assisted through the following programs are eligible to
apply this restriction:
a. Section 236 (insured and non-insured);
b. Section 221(d)(3) BMIR; and
c. Section 202 of the Housing Act of 1959, as Section 202 existed
before the enactment of the Cranston-Gonzalez National
Affordable Housing Act (i.e., Section 202 projects developed prior
to 1991). See paragraph 3-20 B for 202/8 eligibility requirements.
NOTE: In order to restrict occupancy to the elderly in accordance
with Section 658, the project must have continuously operated
solely as an elderly project.
2. Definitions. The following definitions are used when implementing this
restriction:
a. For Section 236 projects (insured and noninsured with or without
Rent Supplement, RAP, or LMSA) and for the Section 221 (d) (3)
BMIR projects (with or without Rent Supplement) the following
definitions are used:
(1) An Elderly person or family is defined as a household
where the head or spouse is age 62 or older.
(2) A disabled or handicapped person or family is defined by
the Section 202 definition in effect at the time the project
was endorsed. See the definitions for Section 202 projects
in Figure 3-5 for projects endorsed prior to the change of
definition in 1974. In 1974 the definition of handicap was
amended to include other categories of disabilities. See
the definition for Section 202/8 in Figure 3-5)
b. For the Section 202 Direct Loan Program funded from Fiscal Year
1960 through Fiscal Year 1964 the following definitions are used:
(1) Elderly is defined as single people aged 62 or older;
households the head of which (or the spouse) is aged 62
or more.
(2) Nonelderly Disabled are not included in the definition and
are not eligible.
c. For the Section 202 Direct Loan Program funded from Fiscal Year
1965 through Fiscal Year 1974 the following definitions and
requirements are used:
(1) Elderly is defined as single people aged 62 or more or
households the head of which (or the spouse) is aged 62
or more.
(2) The definition of elderly was amended to include
“handicapped” in 1965. A person shall be considered
handicapped if such person is determined to have a
physical impairment which is (a) expected to be of long-
continued and indefinite duration; (b) substantially impedes
his ability to live independently; and, (c) is of such a nature
that such ability could be improved by more suitable
housing conditions.
(3) Ten percent of the units in a Section 202 project for the
elderly were designed for people with mobility impairments
and could house persons (elderly or nonelderly) who
required the accessibility features of the unit; a Section
202 project could also be developed just for non-elderly
persons with physical disabilities.
(4) To qualify for admission to one of the units for the elderly,
the applicant must be an elderly family (see definitions in
Figures 3-5 and 3-6).
(5) To qualify for admission to one of the units specifically
designed for persons with physical disabilities, the head or
spouse must be at least 18 years old and have a disability
requiring the accessible design features of the unit.
NOTE: Persons with degenerative conditions (e.g., AIDS,
multiple sclerosis, or cancer) qualify for one of these units if
they require the accessible design features of the unit.
(6) Any Section 202 direct loan project developed specifically
for persons with disabilities is not covered under Section
658.
(7) Persons who meet the definition of a "person with
disabilities" and who do not require the accessible features
of these units may be admitted to the project only if they
qualify as elderly for one of the units designed for elderly
occupancy.
(8) In assigning units designed for disabled persons needing
accessible features, owners must treat elderly applicants
with disabilities and nonelderly applicants with disabilities
equally, unless one applicant has a preference adopted by
the owner such as a residency preference or a preference
for working families, disability or other groups as described
in paragraph 4-6 C.
3. Owners must be able to demonstrate that the property was originally
designed for occupancy only by elderly families in order to restrict
occupancy to the elderly. Owners must be able to produce one primary
source of information or two secondary sources of information showing
that the project was intended to house elderly families.
a. Primary sources. Identification of the project (or portion of the
project) as serving elderly families in at least one primary source
such as:
(1) The application submitted in response to the notice of
funding availability;
(2) The terms of the notice of funding availability under which
the application was solicited;
(3) The regulatory agreement;
(4) The loan commitment;
(5) The bid invitation;
(6) The owner's management plan;
(7) Any underwriting or financial document collected at or
before loan closing; or
(8) Application for Mortgage Insurance
b. Secondary sources. If an owner does not have at least one
primary source, two or more secondary sources of evidence may
be used such as:
(1) Lease records from the first two years of occupancy for
which records are available showing that occupancy has
been restricted primarily to households where the head,
spouse, or sole member is 62 years of age or older;
(2) Evidence that services for elderly persons have been
provided, such as services-funding by the Older Americans
Act, transportation to senior citizen centers, or programs
coordinated with the Area Agency on Aging;
(3) Project unit mix with more than 50% efficiencies and one-
bedrooms; and
(4) Other relevant historical data, unless clearly contradicted
by other comparable evidence.
c. Sources in conflict
(1) If a primary source establishes a design contrary to that
established by another primary source upon which the
owner would base support that the property is an eligible
project, the owner cannot make the election of preferences
for elderly families as provided by this paragraph based
upon primary sources alone.
(2) In any case where primary sources do not provide clear
evidence of original design of the project for occupancy
primarily by elderly families, including those cases where
primary sources conflict, secondary sources may be used
to establish the use for which the project was originally
designed.
(3) In the event that HUD staff is requested to make a decision
based upon “totality of circumstances”, HUD staff should
thoroughly research HUD records prior to making such a
decision. If there is uncertainty regarding the weight of the
available source documents used for determining eligibility,
HUD staff must render a decision that the project was not
designed to serve the elderly.
4. An owner is not required to submit documentation that the project was
originally designed for occupancy by the elderly for HUD approval prior to
implementing the elderly restriction. An owner must produce the
documentation as evidence of eligibility to apply the restriction when
asked by HUD.
5. Waiving the Elderly Restriction. An owner may request to waive the
elderly restriction due to market conditions and/or to maintain the
economic soundness of the project. In such cases, HUD approval is
required before the restriction can be waived and the waiting list opened
to nonelderly persons. For example, if an owner of a project governed by
658 elects to continue to restrict occupancy to the elderly under this
section of the Act, the applicants eligible for occupancy would be based
on this restriction. However, if an owner lifts the restriction to fill a vacant
unit in the project and rents to a nonelderly tenant, the owner may, but is
not required to, retain the elderly restriction for those units previously
occupied by non-elderly tenants. The owner may retain the elderly
restriction only if the unit was rented to a nonelderly tenant due to market
conditions and/or to maintain the economic soundness of the project.
HUD will review the request, and if approved, the HUD approval is not to
exceed three years. HUD approval must be obtained to extend the
waiver beyond the three-year period. If HUD approval is obtained and
there are eligible elderly persons on the waiting list, the owner may select
elderly applicants in accordance with the elderly restriction over
nonelderly tenants on the waiting list. The owner also has responsibility
for updating the Tenant Selection Plan and notifying the nonelderly
applicants currently on the waiting list within ten business days of such
update. The owner must provide written notification and the notice must
be sent to the applicant by certified mail, return receipt requested. Proof
of notification to the applicants on the waiting list must be maintained in
the project occupancy files.Source: Legislative text reproduced verbatim
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