What are the requirements for eligibility? To be eligible for a Restructuring Plan under this part, a project must:

Have a mortgage insured or held by HUD;

Be covered in whole or in part by a contract for project-based assistance under—

The new construction or substantial rehabilitation program under section 8(b)(2) of the U.S. Housing Act of 1937 as in effect before October 1, 1983;

The property disposition program under section 8(b) of the U.S. Housing Act of 1937;

The moderate rehabilitation program under section 8(e)(2) of the United States Housing Act of 1937;

The loan management assistance program under section 8 of the United States Housing Act of 1937;

Section 23 of the United States Housing Act of 1937 as in effect before January 1, 1975;

The rent supplement program under section 101 of the Housing and Urban Development Act of 1965;

Section 8 of the United States Housing Act of 1937, following conversion from assistance under Section 101 of the Housing and Urban Development Act of 1965; or

Section 8 of the U.S. Housing Act of 1937 as renewed under section 524 of MAHRA;

Have current gross potential rent for the project-based assisted units that exceeds the gross potential rent for the project-based assisted units using comparable market rents;

Have a first mortgage that has not previously been restructured under this part or under HUD's Portfolio Reengineering demonstration authority as defined in § 402.2(c) of this chapter;

Not be a project that is described in section 514(h) of MAHRA; and

Otherwise meet the definition of “eligible multifamily housing project” in section 512(2) of MAHRA or meet the following three criteria:

The project is assisted pursuant to a contract for Section 8 assistance renewed under section 524 of MAHRA;

It has an owner that consents for the project to be treated as eligible; and

At the time of its initial renewal under section 524, it met the requirements of section 512(2)(A), (B), and (C) of MAHRA.

When is eligibility determined? Eligibility for a Restructuring Plan under paragraph (a) of this section is determined by the status of a project on the earlier of the termination or expiration date of the project-based assistance contract, which includes a contract renewed under section 524 of MAHRA, or the date of the owner's request to HUD for a Restructuring Plan. Eligibility is not affected by a subsequent change in status, such as contract extension under § 401.600 or part 402 of this chapter.