Everyone deserves to live in a decent, safe, and sanitary home. But not everyone can afford a home that meets those criteria.
That’s why the federal government offers the Section 8 Housing Choice voucher program, which subsidies rent for very low-income families, as well as elderly and disabled people.
Section 8 recipients aren’t forced to live in housing projects or homes that have been designated for low-income residents. Instead, this program covers a wide assortment of houses, townhomes, and apartments in a variety of neighborhoods.
It allows recipients to choose their own home as long as the landlord participates in the program as well.
How does Section 8 housing work?
Section 8 offers a rent subsidy, but the benefit isn’t paid directly to recipients in cash. Instead, there’s a five-step process.
Here’s how it works:
1. The family applies for and receives a Section 8 housing voucher from a local public housing agency (PHA).
2. The family chooses a home where the landlord has agreed to accept Section 8 benefits. In some cities, landlords are required to accept Section 8. In other cities, accepting Section 8 is optional for landlords.
The home that the family selects must meet the PHA’s minimum standards for health and safety. If a family already occupies a home that meets those standards and the landlord accepts Section 8 vouchers, the family can use their Section 8 benefit to stay in that home.
In some cases, a PHA may allow a family to use a Section 8 benefit to purchase a modestly priced home.
3. The family designates its Section 8 benefit to the landlord.
4. The landlord uses the Section 8 benefit to collect the subsidizes portion of the rent from the PHA. The PHA receives funds to distribute from the U.S. Department of Housing and Urban Development (HUD).
5. The family pays the difference between the rent and the subsidy. For example, if the rent was $2,000 per month and the Section 8 benefit covered $1,700 per month, the family would pay the landlord $300 per month.
Section 8 guidelines for landlords
In some cities and states, it’s illegal for landlords to discriminate against people who receive Section 8 benefits. That means landlords can’t advertise “No Section 8” or treat Section 8 recipients differently.
Landlords who are required or willing to accept Section 8 don’t have to say yes to everyone who shows up with a Section 8 benefit. Rather, they must use the same rental screening procedures they would use to evaluate any other prospective tenant to consider Section 8 rental applicants.
How do you become a Section 8 landlord?
The best way to find out about Section 8 requirements for landlords is to contact the local PHA. That’s because every PHA sets its own rules.
Landlords might encounter a variety of procedures and rules for:
- How landlords can apply and be approved to accept Section 8 residents if acceptance isn’t required by law.
- Waiting periods to apply and be approved.
- How the PHA makes rent payments to the landlord (e.g., by check or direct deposit).
- What types of tenant screening methods may be used by the PHA and/or landlord.
- Whether it’s okay to rent to family members who receive Section 8 benefits and, if so, which family members are allowed. For example, immediate family members might be prohibited while distant cousins might be okay.
- How much landlords can collect from the tenant as a security deposit.
- Whether utility bills are included in the rent or are paid by the tenant.
- How and when an existing tenant’s rent can be raised and if so, how much.
- Lease terms, including whether a one-year lease must be renewed annually or can be converted to a month-to-month tenancy.
- How and when a lease can be terminated or not renewed, and what notification must be given to the tenant in such situations.
Pros and cons of Section 8 housing for landlords
In places where landlords are allowed to discriminate against Section 8 recipients, they have a choice of whether to rent to those tenants or not.
There are sound reasons to say yes as well as some downsides to consider.
Renting To Section 8 Tenants: Pros and Cons
Here is a list of the benefits and the drawbacks when considering Section 8.
- A portion of the tenant’s rent is paid by the U.S. government, so the rent payment is essentially guaranteed.
- You’ll have to fill out any paperwork required by the local PHA.
- Leases are generally for one year.
- Your rental property must be inspected and approved by the PHA annually.
- Section 8 tenants tend to occupy the same home long term, in part because it can be a hassle for them to get permission from the PHA to move or because they are elderly or disabled and may have difficulty moving.
- Your property must meet the PHA’s minimum standards for health and safety.
- The PHA will review your lease and limit how much rent you can charge based on market rents for comparable properties in your area.
- The inspection and, if necessary, the repair process can take a while. Meanwhile, your property may be vacant and your expected tenant might decide to live someplace else
Who is eligible for Section 8 housing assistance?
Finding out whether you’re eligible for a Section 8 housing benefit isn’t always easy. That’s because each PHA sets its own eligibility rules with HUD’s national guidelines.
To meet HUD’s requirements:
- You must be a U.S. citizen or a non-citizen who has an eligible immigration status.
- Your household income must be less than 50% of the median income for a household of the same size in the county or metropolitan area where you want to live.
PHAs are required to give 75% of their Section 8 vouchers to people whose income is less than 30% of the median income for their household size in the county or metropolitan area where they choose to live. Household size refers to the number of people who live in the home.
Median incomes vary, sometimes dramatically, from one area to another. HUD’s website includes a searchable database of median incomes in the U.S. The amounts are updated annually, so be sure to search for the current year.
You can also contact your local PHA (see below) for more information on what the median income is for a household the size of yours in your area.
How to apply for Section 8
To apply for a Section 8 housing benefit, you’ll have to contact your local PHA since all the applications are handled at the local level. You’ll need to complete an application and provide documentation that the PHA will use to verify your household income.
How long it takes to be approved varies from one PHA to another. And once you’re approved, some PHAs have long waiting lists for their limited supplies of vouchers. Some waiting lists are so long that the PHA has to close the waiting list to new applicants.
Some PHAs give priority to certain applicants, such as people who are homeless, living in substandard housing, paying more than half their income for rent, or were evicted without cause.
In some states and localities, landlords are required to accept Section 8. In others, it’s optional. If landlords aren’t required to participate in your area, ask your PHA to give you a list of landlords that do participate and have rental homes available.
The bottom line
Just because a landlord accepts Section 8 doesn’t mean that he or she has to approve anyone who receives this benefit as a tenant. Landlords are encouraged to screen Section 8 recipients in the same way they would other prospective tenants.
If you receive a Section 8 benefit and then decide you want to move to a different city, you may be able to take your housing benefit with you. You’ll need to contact the PHA where you currently live and the PHA in your new city to arrange a transfer of your benefit.
Other government agencies offer housing assistance as well. One example is the U.S. Department of Agriculture (USDA) Rural Development (RD) division, which offers several programs in rural areas. These include rental assistance and self-help housing loans for low-income individuals and families. Contact a local USDA-RD office for more information.
If you’re tired of renting and ready to become a homeowner, start by comparing mortgage lenders today.