Section 8 Tenants? Dos and Don’ts for Homeowners
Section 8 is a Housing and Urban Development (HUD) assistance program for low-income families that provides housing payment assistance to families based on their ability to pay for housing expenses.
Section 8 programs are administered by a Public Housing Authority (PHA); either the State, the local city housing authority, or the county housing commission. The PHA pays the landlord most of the rent each month directly. Assistance program contracts are administered on one-year terms. So to avoid mid-term changes for Section 8 tenants, my advice is to make your leases with annual renewals rather than converting to months. This will help reduce your turnover rates and keep your properties fuller longer.
To be approved and accept a Section 8 tenant, your rental property must meet HUD inspection guidelines, which will verify that the property is in livable condition and that all utilities are in operation. You should obtain a copy of these requirements from your local PHA and make sure you are familiar with all areas included in the inspection. Make a good impression if your property passes inspection the first time. However, don’t be discouraged if an issue arises that requires additional work before you get final approval. The agency will give you 30 days to correct any problems. Please note, however, that the PHA will not pay for the rental days until the property “passes” the inspection. Therefore, you should include that in your tenant’s move-in schedule, and it is STRONGLY suggested that you do not allow your tenant to move in until they have passed the inspection and signed a Housing Assistance Program (HAP) contract. of the PHA.
- Examine the tenants; They are responsible for the terms of the lease, not the Agency.
- Review the inspection guidelines and familiarize yourself with all the requirements.
- Get as much security deposit as your state allows. Many times this is one or one and a half times the amount of the monthly rent.
- Make your one-year leases with one-year renewal extensions instead of converting them to month-to-month. Therefore, you will be less likely to have to deal with moves in the medium term.
NOT TO DO
- Do not allow the tenant to move out until you have a signed HAP contract.
- Don’t wait until the last minute to have your property ready for inspection.
- Don’t assume that since you have a contract with HUD, they will pay for damages caused by the tenant. They will not!
- Do not include the tenant’s utilities in the rent amount, the PHA will not pay you dollar for dollar for utilities and you will lose money.