HUD Handbook 4350.3 § 6-25

A.        When Owners May Require Other Charges

                  An owner may charge tenants for allowable charges identified under
                  subparagraphs B, C, D, and E below.

        B.        Checks Returned for Insufficient Funds

                  1.      Owners may impose a fee on the second time, and each additional time,
                          a check is not honored for payment. (See paragraph 5 of the Model
                          Lease for Subsidized Programs for more information.)

                  2.      The owner may bill a tenant only for the amount the bank charges for
                          processing the returned check.

3.       Field Offices or Contract Administrators may authorize an owner to
                          impose additional charges, if such charges are consistent with local
                          management practices and are permitted by state and local laws.

                          NOTE: This paragraph does not apply to Section 202/8, Section 202
                          PAC, Section 202 PRAC and Section 811 PRAC projects. Owners of
                          Section 202/8, Section 202 PAC, Section 202 PRAC and Section 811
                          PRAC projects cannot charge fees for checks returned for insufficient
                          funds.

        C.       Damages

                 1.       Whenever damage is caused by carelessness, misuse, or neglect on the
                          part of the tenant, household member, or visitor, the tenant is obligated to
                          reimburse the owner for the damages within 30 days after the tenant
                          receives a bill from the owner.

                 2.       An owner may deduct accrued, unpaid damage charges from the tenant’s
                          security deposit at the time of move-out, if such a deduction is permitted
                          under state and local laws.

                 3.       The owner's bill is limited to actual and reasonable costs incurred by the
                          owner for repairing the damages.

        D.       Special Management Services

                 1.       An owner may charge a tenant for special services such as responding to
                          lock-out calls and providing extra keys.

                 2.       At the time of move-out, the owner may charge the tenant a fee for each
                          key not returned.

                          An owner may not charge a tenant for bad behavior, such as foul
                          language, noise, or failure to supervise children. However, if such
                          behavior is serious or prolonged, it may be grounds for termination of
                          tenancy.

        E.       Court Filing, Attorney, and Sheriff Fees

                 1.       Owners may accept payment of these fees from tenants who wish to
                          avoid or settle an eviction suit provided:

                          a.     It is permitted under state and local laws; and

                          b.     The fees appear reasonable and do not exceed the actual costs
                                 incurred.

                  2.      Cooperatives may collect legal and other out-of pocket costs
                          incurred in collecting delinquent carrying charges and in
                          terminating a membership following a member’s default under the

occupancy agreement. The occupancy agreement requires
                          members to pay attorney fees even if the cooperative has not filed
                          a suit. Any charges levied on a cooperative member must be
                          consistent with state and local law and policies approved by the
                          cooperative’s Board.

        F.      Owners May Require Tenants to Pay Other Charges:

                1.       If HUD or Contract Administrator has approved the charges; and

                2.       The schedule of charges is either:

                         a.      Listed in the lease agreement; or

                         b.      Has been distributed to all tenants in accordance with the
                                 modification of the lease requirements and procedures listed in
                                 this chapter, paragraph 6-12.D.