Under the tenant-based program, eligible families with a certificate or voucher find and lease a unit in the private sector and pay a portion of the rent (based on income, generally around 30 percent). The local housing authority pays the owner the remaining rent, subject to a cap referred to as Fair Market Rent (FMR) which is determined by HUD. The owner cannot charge a Section 8 tenant more than FMR, even if the owner does so for non-Section 8 tenants in similar units.
Section 8 is one of those mysterious programs many landlords are unclear about. There are pros and cons to section 8, but first the landlord should understand that it is not mandatory to accept section 8 applications.
Who is Section 8
1. It has been used in the past to open up housing that the courts have deemed to be discriminatory. Hills v. Gautreaux, a ruling by the US Supreme Court.
In this case a number of Chicago families living in housing projects were awarded Section 8 vouchers allowing them to move to the suburbs in compensation for the housing project’s substandard conditions.
2. When public housing residents must be relocated because of rehabilitation or demolition of public housing units
3. Housing assistance for a low income family or individual.
1. Meet Govt. income guidelines
2. Pass a criminal background check
3. Have at least one family member who is a U.S. Citizen or has eligible Immigration status
* Owners get rent security
* Yearly inspections of the unit
* Fair market rental rates
* Strict renter responsibilities defined in the lease addendum
* On-time payments
* Tenants can be removed from the program for damages to the unit or failure to pay rent.
* Waiting list of tenants provides landlord with a stream of eligible renters
* Two Contracts: Your standard lease and a Govt contract with HUD.
* Govt is another party to the tenant landlord relationship
* Rules may be different: California Civil Code statue provides in pertinent part as follows: Where an owner terminates or fails to renew a contract or recorded agreement with a governmental agency that provides for rent limitations to a qualified tenant, the tenant or tenants who were the beneficiaries of the contract or recorded agreement shall be given at least 90 days’ written notice of the effective date of the termination and shall not be obligated to pay more than the tenant’s portion of the rent.
* Annual Govt inspections of the unit by Govt inspectors to assure quality housing
* Fair Market Rent is the cap the Govt imposes on what it will pay for your rental unit – you may feel you can get more for the unit
Howard Bell for yourpropertypath.com