Getting started with Section 8

16 Replies

After receiving countless inquires whether Section 8 vouchers are accepted, I decided to give it a go on a 1 bedroom apartment. This is in Penn Hills, Allegheny County, a suburb of Pittsburgh.

I screened tenant like any other and signed a lease for her to move in Nov 1st. Per the tenant, there was a delay with her case because she was prevously managed by the Pittsburgh HUD office and had to transfer to county , but I did finally hear from the Allegheny County office end of November and inspection was passed early December. I received a letter from the office stating that the apartment and rent were approved, lease would begin day of inspection, and that I needed to call if there were any changed within 7 days (no changes after contract written). I called next day and left message asking to have start date changed to Nov 1st. I have heard nothing from them since. I did call again in mid-January asking for a call or email on status, but still no response.

Is this the normal process? Does anyone have a good contact with the Allegheny County (PA) office that they could share? Tenant has been there for 3 months already with no payment...

thank you for any advice!

When you partner with the State and accept Sec. 8 you are at an extreme disadvantage. You have little recourse but to accept their arbitrary rules and bureaucratic bungling. The reason you get so many inquiries as to whether you accept Sec. 8 is because many landlords have dropped out of the program and will not accept it. I will never, under any circumstances, participate in this program again.

@Jeff Rabinowitz I see why these people have such a hard time trying to find a place! Before trying it I did discuss with several REIA members, so I expected a delay, but not 3 months and no communication or payment. I might have to go back to all paying tenants if this doesnt get better. I'm glad I only tried with 1 apartment to start!

@Jennifer Lee  thank you....I'll try reaching out to @Jerry Kisasonak  

Rick,

She is what is called a Port meaning she came from city over to the county this process can take a while especially if the tenant is dragging their feet.  Sec8 can be great but its like anything else you have to fully understand all the variables to maximize profits and minimize headaches! Fist thing sec8 will only start the lease on the 1st or the 15th they do not prorate rent.  Sec8 tenants can be wasting your time so you need to make sure when you interview them that they in fact have their moving papers (RFTA papers) and they are ready to move and have the money to do so. Landlord verification is paramount!!! I never sign a lease with a sec8 tenant until the unit has passed inspection and they have the required security deposit and their estimated rent portion. Did you have your lease approved by sec8 or are you using theirs? The worst thing you can do with a sec8 tenant is to move them in without requiring this because sec8 can take 2 months to let you know what they owe and by that time they owe 3 months of back rent and most likely will be evicted. Estimated rent is a rough estimate of what their rent will be and there are 2 ways you can get this either by calling the tenants case worker (email works better with them sometimes so try both) or you can calculate it your self by having them tell you what they receive in monthly income, their portion will be roughly 30% of that amount.  Items included in this would be welfare/cash assistance/child support/TANF then minus expenses she claims like childcare etc but you can ballpark it until you get thee official amount and then back adjust the tenants ledger to reflect the correct amount. You should also be lenient with late fees until this process is complete to ensure a smooth ride going forward. Another trick to get you a ballpark number is to ask what their portion was at their last place? if they have not had a change in income and its the same bedroom size the number will work for now but you have to collect something until sec8 gives you the official amount. You need to ask the tenant who their caseworker is and if you cannot get a response from the caseworker try higher up. I know them all in the city but in the county I'm not sure who is still there Donna Memmo handles the Ports over there you can try her if no response see if Kim Longwell is still the director and she may be able to help. I like sec8 personally its all about creating systmes and connections. If you have any other questions feel free to ask. Good Luck-Sam

Also wanted to recommend reading "the section 8 bible" and to say the #1 Reason I love Sec8 where else can you collect $1000 in rent on a $20k house? lol

@Sam T.  

Thank you for the very detailed advice! Sounds like I have made a few mistakes already. I let tenant move in on my lease (a slightly modified version of the Pittsburgh REIA "Jean's Lease"). I did collecet standard security deposit (1 month's rent), but tenant assured me that Section 8 paid 100% for her so I have not been collecting any rent. I did have tenant activate utilies in her name as agreed in the lease.

I will contact tenant this weekend to get name of her caseworker....and follow up with the contact you mentioned if I am unable to reach the caseworker next week.

I have heard of the Section 8 Bible, but havent read it...I'll check it out!

Well she very well could be $0 pay and they are GOLD!!! (MY FAVORITE) The thing about sec8 is that its all about systems the most important thing is to screening process. Fair Housing considered you have to be very careful but knowing certain things can help minimize any pain example someone who has been on sec8 for 10 years and they have a clean background (no eviction filings) will most likely make a much better tenant than someone who just received their voucher for the first time. As far as utilities go have them turned off the day after the inspection as you are only required to have them on for the initial inspection that way you don't get $1000 gas bill and a sad story! If its not practical for you to have the place winterized at least do this in the summer months. Owed utility bills is a red flag on the background because if they owe they cannot get service in some cases. I got a copy off Jean years ago at a meeting and its a great lease but the lease I use puts that to shame for sec8 use anyway in fact I'm almost embarrassed to have someone see it but boy are you covered!!! and its PA sec8 specific made by the creator of the sec8 bible best money you will ever spend! 

And you didn't make any real mistakes you have a signed lease and as far as you know she is zero pay. I have seen some sec8 landlords let a tenant in without a lease and wait until the sec8 lease comes and they have zero recourse when the tenant doesn't pay or loses their sec8 all together. Also since its been 3 months you will want to conform with the caseworker the tenant has not lost their voucher. I have had tenants loose their voucher because they failed to do paperwork and then got evicted in Feb with kids.

Thanks for dragging me into this @Jennifer Lee   :)

I don't really have much to add here besides what's been said already. Expect there to be a very long delay on pay when you first get the tenant in. I've waited as long as three months. As for communication, expect it to suck. I know some people who use three methods of communication with the caseworker. Walk-in delivery, faxing, and emailing. When they need to get paperwork done they send the same paperwork using all three methods just to make sure it gets done AND they follow up with a phone call a few days later to verify. Personally I'm too impatient for this type of incompetence.

Also, I don't care for the fact that many Sec8 people are home ALL THE TIME. For us, that means heavy wear and tear versus 9 to 5'ers who basically only spend their evenings at the property - and that's if they don't go out and about after dinner. Additionally, people who have loads of time on their hands often get silly, or sick depending on how you want to look at it. They can be high maintenance. As the Good Book says/warns, the devil finds work for idle hands.  

If you have a nice property in a good/decent area, I don't see the need to go with the program. If you chose to buy cheap properties in mainly in Sec8 rental areas for high cashflow, better have thick skin and a desire for a more active role in managing your portfolio. In my earlier days I would not have had any concerns with this type of investing, but for where we are at now (15 years in the game), we look for properties that don't require us to settle for subsides. I'm not saying we wouldn't make an exception here and there, but it's not our current business model.

So Rick, I think you've got a basic taste of how the system works (or tries to). I wouldn't think you'd need to see too much more to make a decision on it. Get in touch if you need anything...

@Jerry Kisasonak  

 your welcome! Just kidding. I meant that your could help him with getting connected with your local support group.

NEVER EVER EVER let a section 8 tenant move into the house or sign the lease until

  • the unit has been inspected by the housing authority and passed
  • they have approved your requested rent and told you the tenants portion they will pay
  • they have approved a move in date
  • they have set a date and time for you and the tenant to meet at the housing authority for you to sign the housing authorities lease addendum.
  • you need to make sure the tenant has called the Utility company to have service put into their names as of the day the lease is supposed to start
  • prior to meeting to sign the lease you need to confirm the tenant has the required security deposit in full
  • tenant does not get the keys to move in until the day before or day of the lease start date
  • you have provided your banking info to the housing authority for the direct deposit payment setup

At this point without some internal point of contact that you can call directly, you should go down to the housing authority immediately to speak with the case worker or a supervisor about the situation. Section 8 tenants are as good as any other tenants but they need to be managed tightly to make sure that the system they are involved with doesnt screw you. you are currently getting screwed and dont seem concerned about it to much as much as you should be. 

@BOB CRANEY  The process for the lease addendum varies place to place, but otherwise you're spot on. Good checklist. 

@Rick C.  I would DEFINITELY go down in person. While it may be you've got a pretty lazy PHA locally and months long waits for communication/payment are common locally, that's not the norm, nor should it be. As for the money you will actually receive, it will be from the date of inspection, that's non-negotiable. They can not pay rent for time before the unit passed inspection, ever, even if you let the tenant move in. Now, your tenant is still legally on the hook for that roughly 1.5 mo. of rent to you, but obviously it might be a bit hard trying to collect on that, especially if they have a low enough income where they're paying 0 rent.

My guess is the PHA is probably under the impression everything is fine regarding the unit, as the communication they've received from you has just been to ask about backdating the rent, which isn't possible. Definitely follow up in person ASAP to make sure this is the case and that they indeed do owe you rent from the inspection date, as well as to get a copy of the letter you should have received stating the tenant's portion of rent v. the PHAs.  

Jerry, Bob, and Bradley. ...thank you for all the guidance and suggestions.  I have verified the caseworker with the tenant this weekend and will go to the section 8 office to follow up as suggested.  Maybe i have been a little too "go with the flow" with this section 8 process, and i do feel like im getting screwed for playing along.  If this continues can i evict tenant for nonpayment? 

Originally posted by @Rick C. :

Jerry, Bob, and Bradley. ...thank you for all the guidance and suggestions.  I have verified the caseworker with the tenant this weekend and will go to the section 8 office to follow up as suggested.  Maybe i have been a little too "go with the flow" with this section 8 process, and i do feel like im getting screwed for playing along.  If this continues can i evict tenant for nonpayment? 

 You can definitely evict for non-payment for the portion of rent owed before the inspection. Whether there's additional rent owed will depend on what kind of answer you get from your PHA regarding the tenant's portion of rent, what day the payments should have started, etc. But either way, they signed a lease with you for x per month, it's still binding whether the voucher helps out or not. 

got through to the caseworker today.....you all were right!  She said that the tenant was supposed to turn something in but did not and they cant write contract until she does.  I called tenant and told her that if she doesn't remedy right away she needs to move out.  Hopefully this gets it going....if not ill get her out and put a paying tenant in.

Thank you everyone

got through to the caseworker today.....you all were right!  She said that the tenant was supposed to turn something in but did not and they cant write contract until she does.  I called tenant and told her that if she doesn't remedy right away she needs to move out.  Hopefully this gets it going....if not ill get her out and put a paying tenant in.

Thank you everyone