HRA100%

HRA / Property and design

Lesson 7: Property eligibility and the reconstruction decision

14 practice questions · Sources reviewed October 4, 2026

Uses your browser's available voice.

Reading

Establish what is being replaced

A property review answers more than whether the house looks worn. Identify the parcel, existing unit, ownership interests, occupancy, site hazards and proposed replacement. Use a consistent address and legal description throughout the file. Include other structures and occupants on the property; they can affect environmental scope, relocation, title and the HOME definition of the project. A photograph of the front elevation alone cannot establish the full condition.

Property eligibility and the reconstruction decision: four decision stagesObserve: Document the existing dwelling, occupants, site and relevant defects.; Classify: Use the actual HRA activity definition and reconstruction evidence.; Resolve: Address title, consents, geographic eligibility and environmental constraints.; Confirm feasibility: Reconcile replacement design, value, costs and required approvals.01Observe02Classify03Resolve04Confirm feasibility
Property eligibility and the reconstruction decision: use each stage with its evidence before advancing.
  1. Observe. Document the existing dwelling, occupants, site and relevant defects.
  2. Classify. Use the actual HRA activity definition and reconstruction evidence.
  3. Resolve. Address title, consents, geographic eligibility and environmental constraints.
  4. Confirm feasibility. Reconcile replacement design, value, costs and required approvals.

Under 10 TAC 20.9, the initial inspection must document the relevant substandard conditions and provide adequate evidence supporting reconstruction. The rule describes circumstances involving a building official's beyond-repair certification or condemnation, and distinct treatment of certain MHU activities. Use the applicable route and retain its evidence. Do not create an unsupported rule that every house qualifies when repairs exceed an arbitrary percentage of replacement cost.

Make the inspection useful

Describe the defect, its location, supporting photograph, safety implication and effect on feasibility. Separate an observed condition from a suspected concealed problem. If structural concerns require a licensed professional, obtain that assessment rather than offering an unsupported engineering conclusion. Record inspection limitations and the follow-up needed. The current 23.26(12) requires signed and dated inspections with specified exterior and interior photographs.

The applicable Texas Minimum Construction Standards edition remains a point to confirm with TDHCA: the research found differently dated editions. Record the edition TDHCA directs the project to use. Avoid copying old equipment-efficiency or electrical-service numbers into a current scope. Current adopted codes, energy requirements and project-specific standards still need their own review. A dated inspection template should not become the accidental design code.

Resolve title before irreversible work

Review ownership evidence, liens, taxes, mortgages and the necessary consents. A person living in the home may not be its only owner. An inherited interest or life estate needs document-specific analysis. For loan assistance, HRA includes requirements addressing lien position and existing home-equity liens. Obtain lienholder consent to demolition and subordination where required. A contractor's willingness to proceed does not resolve title defects.

The program uses title reports, commitments and other documents with specified freshness requirements. Have the closing professional and program reviewer confirm the correct instrument and date for Reconstruction versus New Construction. Log deficiencies and track their resolution. Do not demolish a structure while assuming a missing owner's signature can be obtained later.

Screen site and geographic conditions

Verify the property is in the approved service area and eligible under the funding notice's participating-jurisdiction limitations. Check floodplain and other environmental conditions through the responsible review process. A flood map is evidence, not environmental clearance by itself. Identify utility, access, drainage, zoning and permit issues early enough that the budget and design can respond.

Alternative-site HRA activities require particular Department approval and ownership evidence. Section 23.31(a)(8) contains special treatment of demolition of the original unit when relocating: staff must not assume that the ordinary HOME activity budget can pay that demolition or count it as eligible match. Distinguish the old site, new site and funding source for each cost. Keep the Department's written determination with the scope.

Test replacement feasibility

For an MHU replacement, verify applicable manufactured-housing construction, installation, foundation, utility, land and ownership-record requirements. Plan for the old unit's documented removal or salvage. For a site-built home, coordinate certified plans, current property standards and the post-improvement value limitation. The homeownership value ceiling is separate from the construction-cost and HOME subsidy ceilings.

The proposed staff decision memorandum records the activity classification, inspection findings, title status, environmental constraints, applicable value limit, feasibility conclusion and outstanding approvals. Use "hold" when a necessary determination is missing. A property should advance only when its evidence supports the chosen route. Retain the reasoning even if the project is later declined or referred elsewhere.

Work the case

A house has serious foundation distress. The owner says a sibling has an inherited interest but will probably agree to demolition.

Review the decision

Obtain the necessary professional condition assessment and title review. Identify every required owner and lienholder consent. Do not treat the apparent severity of defects as permission to bypass ownership or environmental review. Hold demolition until all required approvals and consents are documented.

Apply it in the file

Authorities for this lesson

Practice questions

1. What supports reconstruction eligibility?

  1. Only the owner's preference
  2. Only a contractor's sales estimate
  3. Documented applicable condition evidence
  4. Only the age of the paint

2. Should staff invent a repair-cost percentage threshold?

  1. Yes, fifty percent always applies
  2. Yes, any percentage in a bid
  3. Yes, whenever a roof leaks
  4. No

3. What should a condition report distinguish?

  1. Observed defects and unverified concerns
  2. Only expensive and inexpensive paint
  3. Only contractor preferences
  4. Only occupied and empty bedrooms

4. An inherited co-owner has not consented. What should staff do?

  1. Let demolition begin anyway
  2. Resolve required ownership consent
  3. Ask the contractor to sign for them
  4. Remove their name from the file

5. Which TMCS edition should be used when posted copies conflict?

  1. Automatically the oldest copy
  2. Automatically the shortest copy
  3. The applicable edition confirmed by TDHCA
  4. Any edition a bidder prefers

6. Does a flood map establish environmental clearance?

  1. Yes, if the map is printed
  2. Yes, if no blue shading appears
  3. Yes, if the contractor has insurance
  4. No

7. What should property photos include under the current inspection rule?

  1. Required exterior and interior views
  2. Only the street sign
  3. Only new equipment brochures
  4. Only the contractor's truck

8. What should staff do about an engineering concern?

  1. Write an unsupported structural certification
  2. Obtain the qualified assessment needed
  3. Assume demolition is the only answer
  4. Hide the concern from the designer

9. Is the homeownership value ceiling the construction-cost cap?

  1. Yes, they are identical
  2. Yes, for every MHU
  3. No
  4. Yes, when the house is rural

10. An alternative-site project includes old-site demolition. What is required?

  1. Automatically charge it to HOME
  2. Automatically count it as match
  3. Ignore the old property entirely
  4. Review the special funding and match restrictions

11. What is needed for an MHU replacement?

  1. Applicable installation and ownership evidence
  2. Only a retail invoice
  3. Only a transport permit
  4. Only the owner's preferred model

12. What is the correct status for an unresolved title defect?

  1. Approved because income qualifies
  2. Hold pending resolution
  3. Complete because the inspector visited
  4. Exempt because the owner is elderly

13. What should happen to the reconstruction decision memorandum?

  1. Destroy it once bids arrive
  2. Replace it with a phone call
  3. Retain its evidence and reasoning
  4. Store only the final dollar total

14. Can an old inspection template establish today's energy standard?

  1. Yes, if it has a TDHCA logo
  2. Yes, if staff used it last year
  3. Yes, if the contractor signs it
  4. No

Glossary

TMCS
Texas Minimum Construction Standards, using the edition directed for the project.
Title commitment
A title insurer document listing conditions and exceptions.
Lien
A legal claim against property securing an obligation.
MHU
Manufactured Housing Unit.
Post-improvement value
Property value after the proposed work.
Feasibility
Whether an eligible project can be delivered within its constraints.
Previous lessonNext lesson

Print the field checklist · Sources and unresolved decisions