HAP Contract: Everything You Need to Know

If you’re a property owner or operator participating in HOM’s Permanent Supportive Housing (PSH) program, the Housing Assistance Payment (HAP) contract isn’t just paperwork — it’s the driving force that keeps the program working for both you and your tenant. 

The HAP contract is a formal agreement between you (the property owner or operator) and HOM. The contract guarantees ongoing rental assistance and outlines program compliance requirements. Paired with your standard lease, it creates a dual framework: your lease governs the daily landlord–tenant relationship, while the HAP contract ensures financial stability through guaranteed rent payments and supports long-term housing success. 

In this blog, we break down the HAP contract’s key sections, outline your rights and responsibilities as a property owner or operator, and explain how it provides both housing stability for tenants and dependable rent payments for you. 

What is a HAP Contract?

A HAP contract is a binding agreement between you and HOM, providing tenant-based rental assistance under the PSH program. While a standard lease covers rent, property rules, and other daily matters, the HAP contract focuses on: 

• Subsidy payments 
• Housing Quality Standards (HQS) 
• Tenant protections 

Together, these agreements stabilize housing for vulnerable tenants while safeguarding your financial interests as a property owner or operator. 

The contract also ensures compliance with fair housing laws, prohibits discrimination, and strengthens Arizona communities by addressing homelessness. 

✅ Learn more about the Arizona Residential Landlord Tenant Act (ARLTA)

✅ View/Download a sample HAP Contact

HAP Contract: Section by Section 

The HAP contract is organized into three key parts, each serving a specific purpose to streamline your role in the PSH program.  

1. Part A, Contract Information: Includes essential details like tenant and household information, unit address, lease term, rent amounts, and utility responsibilities.  
2. Part B, Body of Contract: Outlines operational terms, such as maintenance requirements, payment schedules, and remedies for breaches.  
3. Part C, Tenancy Addendum: A mandatory lease attachment detailing tenant rights, rent adjustments, and protections, including those under the Violence Against Women Act (VAWA). 

All three parts must be signed, with Part C integrated into your rental lease. Non-compliance, such as failing to meet HQS, can result in payment suspension, abatement, or contract termination.  

Part A: Contract Information

Let’s take a closer look at Part A of the HAP contract: 

• Part A identifies the tenant and approved household members, noting that no additional residents can be added without HOM and owner approval.  
• The initial lease term is specified with start and end dates, aligning with the rental agreement.  
• Rent details include the initial rent to the owner, HOM’s subsidy payment, and the tenant’s portion, with no rent increases allowed during the initial term, though subsidies or tenant payments may adjust per program rules.  
• It clarifies utility and appliance responsibilities, indicating whether the owner or tenant is responsible for each. 

✅ Read our blog on How to Pass an HQS Inspection

Part B: Body of Contract

Part B is the operational heart of the HAP contract, detailing your responsibilities and protections across 21 sections. Here are the key takeaways: 

• Part B starts by defining the contract’s purpose: to provide PSH assistance for the specified tenant and unit. You certify that the lease includes the tenancy addendum, matches local standards, and complies with Arizona law, while HOM doesn’t screen tenant behavior — you oversee suitability screening. 
• You must maintain the unit per HQS, ensuring safe systems like plumbing and heating, and provide agreed utilities. Breaches, like HQS failures, may lead to payment suspension, abatement, or termination unless corrected within specified timelines (24 hours for life-threatening issues). HOM can inspect anytime, notifying you of defects.  
• The contract runs with the lease term, ending if the lease terminates, the tenant moves, funding ceases, or HQS isn’t met, and auto-terminates 180 days after the last payment or upon a single-member household’s death. 
• Rent must be reasonable compared to similar unassisted units, determined by HOM based on unit quality and amenities. Monthly payments are prompt, prorated for partial months, with overpayments recoverable. You may collect a security deposit (up to 1.5 months’ rent per Arizona law). 
• You certify ongoing HQS compliance, no extra payments, and no family ownership of the unit. Discrimination based on protected classes is prohibited. Breaches, like HQS violations or fraud, allow HOM to recover payments or terminate the contract, with notice to correct issues.  
• HOM can access records, the family isn’t a third-party beneficiary of Part B, conflicts of interest are prohibited (unless waived), and assignments need HOM approval. Foreclosure successors inherit the contract, and all notices must be written. 

✅ Read our blog on How to Pass an HQS Inspection with Ease 

✅ Learn more about Rent Reasonableness

Part C: Tenancy Addendum

Part C, the tenancy addendum, is a mandatory lease attachment protecting tenant rights across 20 sections. Here’s a closer look at what’s included: 

• It confirms PSH assistance and lease compliance with the HAP contract, allowing tenants to enforce Part C if conflicts arise.  
• Only approved household members can reside in the unit, with no subleasing permitted.  
• Rent is capped at HOM-approved amounts, with no increases during the initial term, and tenants pay only their portion, not HOM’s subsidy, and aren’t liable if HOM misses payments. 
• You can’t charge for services like meals or furniture and must maintain HQS, though tenants are responsible for their utilities/appliances and damages beyond wear and tear.  
• Termination is allowed for serious lease violations, illegal activities, criminal behavior (e.g., drug-related or violent acts), or other good cause like neighbor disturbances.  
• After the initial term, additional reasons, such as property sale, apply.  
• Extensive VAWA protections prevent eviction of victims of domestic violence, dating violence, sexual assault, or stalking, allowing lease bifurcation to remove abusers, emergency transfers, and strict confidentiality. 
• Evictions require court action and notice to HOM. 
• HOM may terminate assistance, ending the lease unless the tenant covers full rent.  
• Security deposits follow Arizona law, with itemized deductions returned within 14 days.  
• Discrimination is prohibited, and lease changes need HOM approval for key terms.  
• All notices must be in writing. 

✅ What is Rent Reasonableness and why is it important?  

During the Tenancy

As a Threshold landlord, your responsibilities align with standard Arizona tenancies under the Arizona Residential Landlord and Tenant Act (ARLTA), enhanced by the HAP contract. There’s nothing special you need to do during the tenancy. Basically, you treat it just like any other rental.  

You should: 

• Notify HOM of any notices provided. 
• Maintain the unit per HQS. 
• Ensure safe systems and appliances. 
• Prioritize safety with locks and detectors. 
• Respect tenant privacy with two days’ notice for non-emergency entry. 
• Handle administrative tasks as they arise.  
• At tenancy’s end, request a move-out inspection within two days.  
• Tips for Success: 
• Regularly check HQS compliance to avoid payment issues 
• Communicate early with HOM for renewals or terminations. 

The HAP contract empowers you to provide stable housing while securing your investment through guaranteed payments, risk mitigation, and HOM’s support network. By partnering with us, you’re helping end homelessness in Arizona, building hope one home at a time.  

✅ Need more? Read our companion blog, A Landlord’s Responsibilities During a Subsidized Tenancy