Hi everyone, I'm Mary Celone Welcome to today's Tuesday Tip. This week we're discussing how to handle direct express debit cards and calculations. And while there's been no recent changes here, this was a popular topic that we reviewed a little while back and it still comes up a lot so we thought it would be worth revisiting.


So federal benefits like social security, veterans benefits, SSI, and more are paid electronically through the Department of Treasury. And the two options for receiving these funds are either direct deposit into a bank account or through a direct express debit card. This essentially took the place of mailed paper checks. And a direct express card allows the recipient

to receive their benefits without deposit into a traditional bank account. So funds are automatically loaded onto the cards monthly and the card can then be used like a debit card to make a purchase or withdraw cash.


So after we've counted the income from the actual federal benefit in our calculations, we still have a direct express card that may hold a balance of funds, but it isn't linked to a bank account like a debit card is tied to a checking account would be, for instance. So how do we handle this? Well, in 2013, HUD did state that balances on direct express debit cards are considered an asset

and should be verified the same way we handle savings accounts, meaning you'll count this as an asset using the current balance on the card.

For third party verification of the cards, residents can provide a couple of things. Either a dated statement, which could be obtained through the mail, but that may have an additional cost to it. So they can also use either the website or app associated with their card. Or they can get a dated ATM receipt showing the account balance.

Either way, the statement must show a few different things. For one, the account to confirm it matches the Direct Express card, the account holder to verify who the asset belongs to, the date of the statement to ensure, of course, that it's no more than 120 days old when you receive it, and of course, the current account balance. Now, sometimes the account and account holder

information may not be clearly displayed like in the example of an ATM receipt. So just remember here that HUD requires that the relationship between the verification document and the account holder be clear. So for example if the resident's name isn't shown on an ATM receipt

you would need to confirm that the account matches the residence direct express card. Make sure there's a connection there. How that confirmation happens or is documented is up to the owner agent. But just remember the file should clearly support that the asset information is accurate and tied to the correct resident.

If you'd like to review this further, the guidelines for handling Direct Express cards in calculations is listed here. It's the HUDRIP listserv posting number 296.

And as always, if you have any additional questions, please don't hesitate to reach out to us here at Navigate. We would also love to hear your requests for future topics on Tuesday Tips, so please send us an email with anything you'd like us to cover. Have a great week and we'll see you next time.