Should I vet a long term renter with subsidized rent?

[Brian Tisler]

I am looking at purchasing a 2 bedroom 1 bath older home that currently has a long term renter that has subsidized rent. Is it a could idea and even possible to vet the tenant especially since they have a life time lease?

Thank you BP nation!!

[Account Closed]

By the way, @Brian Tisler, if this is a Section 8 tenant, you should check with the housing authority and find out what the "payment standard" is for that size unit. It's possible you could raise the rents to the maximum "payment standard," but keep this tenant in place - and the tenant's portion of the rent should stay the same. You might as well get the top rent possible for that unit. A lot of Section 8 landlords fail to find out the max they can get for their units, and don't realize that the tenant's portion of rent stays the same, but the portion HUD pays will be bigger.

In other words, a Section 8 tenant only ever has to pay about 30% of their income. The portion of what they pay has nothing to do with the max rent the landlord can get under HUD's payment standards.

So, for instance, let's say the current rent is $500 and the tenant's portion is $200 (roughly 30% of her income). But, the current max "payment standard" is now $700. You could increase the rent to $700, and the tenant still only has to pay $200. HUD picks up the difference.

So, you should check this out, if she's Section 8. You can talk to the housing authority to find out the max you can charge and how to go about getting it. It should just involve a new contract with HUD and some paperwork, and maybe a new inspection. But, it shouldn't be a big deal.