Today the world we live in is challenging in every aspect. Be it a living standard or eating lifestyle, a good institute to enroll in or deeply thought career orientation, a good company of friends or family and a healthy conduct to maintain. In the Hustle of keeping everything perfect one needs to know how to manage finances to cope up with expenses like rent or groceries. One has to think of budgeting for unforeseen expenses like medical, utility, vet bills and tax increase etc. But this burden could be released if you have your own roof under which you can live free of cost. It’s not less than an achievement to own your own house.
However, it’s not a piece of cake in a place like the United States to be an owner of your house due to multiple reasons such as steep penalties, sheer mortgage rates and scarcity of homes. Inflation rates go higher and higher day by day making it difficult for a consumer to keep all expenditure in line. According to research over the past two years median income fell 3% while living cost rose nearly 7% including massive housing and medical costs.
Keeping in view the common man’s problem, the government has initiated several programs in order to provide financial sustenance to its nation. One of its kinds is Section 8 also known as “Housing Choice Voucher Program(HCV).”
It is a privately owned housing scheme that is federally funded. In this program the owner gathers rent from meager tenants and the government. The tenant renders rent based on his income and the rest is paid by the government. The project is administered by the Department of Housing and Urban Development (HUD) in order to come up with rental aid for eligible and unprivileged families. Housing and Urban development is sort of a ray of hope that could possibly make a difference in the lives of people.
History of Section 8
The section 8 program was proposed and validated by Congress in 1974 but was practiced later in 2000’s by Housing and Urban Development (HUD). It proved to be a splash of fresh air for its citizens as ascending rental prices made it impossible to save for a house. According to recent reports, some 15% of American households, that rounds off a figure of approximately 6 million, are behind on rent this fall. Stats show that over 11,000 families have been assisted in the last 5 years.
What Actually Section#8 Is?
It’s a collaborative agenda of the Federal government and Public Housing Authority(PHA) to provide an individual or a family with a housing choice voucher which offers a discount on their rent. The PHA provides a rental subsidy and pays to the landlord on behalf of the section 8 recipient. The recipient then has to pay the difference between actual rent and the amount compensated by section 8. However PHA has established a monetary payment standard. In most of the cases tenants have to pay 30% towards rent and utilities out of their monthly modified entire system. In some cases, this percentage can jump to 40% if the rent is higher than the payment standards.
For instance, say that you live in Texas. The housing authority of your region sets the payment standards of three-bedroom unit at 3000 US dollars. Say if you are found suitable enough to qualify for the program with an income of US $ 3500 per month, then by imposing 30% rule you’ll be responsible for paying $2450 towards rent and utilities.
Types of Section #8:
There are basically two types of section 8 housing;
- Housing Choice Voucher
Tenants meet the authority who is participating in the section 8 program and in bonus they provide the voucher that is a locomotive which means tenants can take their voucher with themselves if they intend to move to another place at the end of lease.
- Project based assistance
In this case, tenants don’t have an easy option of moving around. By doing so they will lose the assistance of the owners who were in agreement with the housing authority.
Eligibility Benchmark for Section 8
In order to subscribe to a scheme there are certain rules and regulations which are obvious to follow so the company finds you competent enough to trust. Another thing is that each state has a slightly different version of Section 8 so requirements may vary from state to state. Generally there are four basic aspects that each PHA focuses on. However exceptions are possible depending on the area. If an applicant gets approval he will be added to the waitlist as demand is higher than available slots. Eligibility criteria comprises of following conditions:
- The applicant should be a first-time home buyer in case he is purchasing a home on a section 8 voucher.
- He should meet income requirements as proposed by the signatory. However, there is an ease for elderly or disabled.
- The aspirant should be full time employed; he should have been working for at least 36 hours a week.
- He should not have any sort of mortgage default; means he should not step back from his words signed on deed of trust. For instance, he was bound to make payments on time; if he is betraying his words then he will definitely face difficulty qualifying for future loans.
- He should not bear any other home ownership interests.
- PHA specific requirements.
Requirements for Section # 8 Voucher
When authority claims to provide you safe, clean and authentic housing then they also demand from your certain assurance that makes you qualify for section 8 rental assistance. We will go through each requirement in detail.
1. Income Limits:
As the program is to help financially down and out people, so the people with extremely low income qualifications are prior. However the income limits are set annually by HUD. These are calculated as percentages of median income for specific areas of the country. The information is assembled by considering both your household annual income and size of your household. Households can be classified as:
- Extremely low income:
It yields about 30% of the area’s median income level
- Very low income:
It can earn up to 50% of their area’s median in income.
- Moderately low income:
It earns 80% of the area’s median come level.
PHA systematizes the list by giving priority to extremely low applications, followed by very low-income applicants then moderately low-income family applicants on a waiting list. The filer should make sure that he has listed every possible income source as he will go through yearly income verification to ensure he is still considerable for financial assistance.
2. Family Status:
Section 8 claimants should live up to HUD’s definition of family, comprising of any of following characteristics can be taken under consideration;
- One household component who is 62 or older
- If any affiliate is disabled.
- Household of numerous members, with or without children.
- Has been dislocated from previous residence due to genuine reasons such as natural calamity, physical damage or Federal government’s action.
- Single person can also apply for section 8.
The person must be U.S citizen or should be permitted immigrant having all legal documentation such as;
- U.S passport
- Social security card
- Green card (if any)
- Registration card
For locals it’s compulsory to declare every household as an American citizen along with children’s nationality by providing their birth certificates. If every family member can’t provide ethical proof of citizenship still, it can have assistance as a “Mixed Family”. But people with complete information will be prior.
If any applicant itself is disabled or any of its households is impaired he can have a quick hearing in the waiting list. But he will have to provide proper medical certificates and evidence. Also he can appeal for an extra room as a patient needs special care and a relaxed environment.
5. Criminal Record:
The applicant must not be in black list. PHA assures safety of his people. Therefore, they don’t risk anyone’s life and their name. He should not have committed any crime especially from last five years. He must bear good moral and should not be indulged in criminal activities like fraud, drugs smuggling, human trafficking or abusing behavior. He should be keen regarding code of conduct that he was agreed upon. According to federal instructions if any of the above scenarios happen, the request would be rejected.
6. Eviction History:
To be considerable for Section 8 assistance the aspirate should have positive outcomes from previous residential status. The PHA will contact the tenants previous landlord to check out how legitimate his attitude was towards his agreement. Whether he was regular in his rental payments, was he good enough to people around him, how synchronized he left his last residence etc. If any household or person himself found responsible for his criminal act the PHA will definitely dismiss his proposal. Use of methamphetamine in a subsidized house can also result in rejection.
How Can I Purchase Own House Under Section 8?
If any person wants to purchase a house under section 8, he should at first visit his local PHA and ask them whether they are participating in Housing Choice Voucher Program (HCV). If they answer Yes, then here you go! You have stepped up on the escalator. But remember there are obvious limitations and regulations you should live up to. There’s a proper check and balance system to maintain the ideal lifestyle promised by HCV. Agenda of HCV is to help you in sustaining home ownership and provide you with a rental subsidy.
This valuable scheme has advantaged over three million Americans. To apply for HCV, Applicants will have to Fill the application form, providing them with requested basic information and submitting supporting documents. If the person got the approval for section 8, he’ll join the waiting list and will have to wait for his turn.
Steps to Purchase a House Using Section 8 Voucher:
There are few mandatory steps that applicants have to follow.
- Find a PHA that participates in the HCV program.
- Request entrance into the program.
- Confirm eligibility.
- Attend homeownership counseling because there is a difference in being a renter and being an owner.
HCV provides another economical plus point for its tenants called Family Self -Sufficiency Program “FSS“. FSS provides self- sufficiency in sectors of education, job training, employment and social skills etc. Its objective includes.
(a) Offering economic independence to those households who wants self-reliance.
(b) Forming cooperative relationships with public and private organizations to get program participants exposure to supportive resources they require to effectively fulfill their contracted goals.
(c) Working on issues that are obstacles to FSS families in getting economic stability. (d) Offering service plans to FSS families that are centered on their needs, abilities and attainable goals.
Factors That Exclude You from Section 8:
Being a homeowner is a major commitment. You are bound to follow the mandate you agreed upon or else any rebellious act will lead to your eviction. Down here are some points which should be taken care of;
- Paying rent on time.
- Refrain from repetitive breaking laws of the charter.
- Criminal conduct using drugs.
- Any illegitimate act that endangers others security or health.
- Any gesture that annoys other people living nearby.
- A history of bad conduct.
- Giving the Housing Authority fake information.
- Breaking the terms of probation or parole.
A home is an investment where you can live freely on your own conditions. You have freedom to renovate and decorate. So, if you find an opportunity to have your own roof, act early and don’t miss the chance. Because PHA works on the principles of Supply and Demand which inflates home prices as time passes by. Priority is on the basis of the waiting list. So, apply timely and enjoy the luxury of rental subsidy.