Sectuon 8 Applicants- how would that work?

3 Replies

I just got an applicant who asked if the property can be for section 8. I'm only looking for buyers who want to rent to own it or owner finance. But I'm just curious how would I offer a section 8 on a property?

Section 8 is not nearly as complicated as it seems, and is really pretty simple.  Contact the local county the house is in and they typically will walk/talk you through it.  Here are the basics - the property owner registers the property with the city/county it is in (the county is usually always looking for good landlords and decent housing).  They then match up properties with qualified tenants.  The government pays part of the rent and tenant is responsible for part of the rent - the ratio is determined by the government.

Pros - government guarantees the rent and depending on the situation, the rent checks are virtually automatic and like clockwork. If the tenant doesn't pay, they can lose their section 8 qualifying status, so there is some outside accountability.

Cons - Tenants can be more high-maintenance and you may not be able to be as picky about your tenants. In any situation, you can't discriminate against anyone, but in a non-section 8 situation, if you get multiple applications, you can screen for the best credit, longest lease, etc and that just puts the landlord more in control, and with more flexibility.  

I've done both, and it really depends on the housing location and the type of house you have.  If it's in a lower income area, it's not a bad deal, just depends on what you want to do with the property.  My bottom line suggestion, call the Housing Authority for the county, tell them you have a property that may qualify  and just ask them how it works.  It'll probably become clear whether it's something you want to try out or not.

Just a couple of corrections on the process - at least based on the 7 housing authorities I work with in my market.  The official term for SEC8 is the Housing Choice Voucher - with choice being the operative word.  The tenant chooses the house; they do not match up tenants with properties. Once you accept an applicant as a tenant, contingent on rent approval, the tenant will provide you with a package of paperwork that you have to complete to submit for rent approval.  (This is called a RFTA - Request For Tenancy Approval.)  The HA will then determine if they can pay your rent based on it being reasonible compared to other comparible non-sec 8 rentals and affordable for this particular voucher holder.  Once they determine if they can pay your requested rent, or you accept the rent they say they can pay, it gets moved to inspection.  Once you pass inspection you can sign a lease and move the tenant in. The fastest this happens in my market is 20 days, assuming no gov’t worker is on vacation.  I understand it I can be much slower in other markets.


- One of the HUD requirements is that the first lease signed has to be 12 months. After that you and the tenant can agree on whatever lease term you want - from month to month to a long length.

- Only a few states restrict source of income from your allowed rental criteria. In VA, and in most states, you can still choose to accept or not accept a tenant based on whether or not they have a voucher.

- Tenants don’t lose their voucher if they don’t pay, but they will lose their voucher for things like getting evicted, being charged with a drug charge or a felony, not reporting a change of income. If they owe you money, you get a judgment AND you report this to their case worker, they won’t be able to receive approval to move out of your unit unless you agree to it. They will only lose their voucher if you file to evict and notify the case worker of this eviction.  

I have over 100 SEC 8 leases in my management company.  I prefer it to a non-SEC 8 lease in low income areas. 

@Asher Carr , as part of our business, my son Nick handles all the buyers.  I know he gets the question all the time, "Do you accept section 8?"  I hear him answer it all the time, "Well our rent to own program requires a more substantial down payment then section 8 usually provides.  So it is usually not a fit for section 8 tenants."  Realistically you are looking for someone who will be able to afford to support the property on their own.  However you can go the section 8 direction if you just want to rent it.  We are looking for buyers, not renters.

Hope that helps,

Chris Pre