How to get paid by Section 8 Tenants? – Investor’s Guide
In this opportunity we are going to talk about how you can actually qualify to get paid by Section 8. First, let’s take a step back and talk about Section 8 tenants itself. Unfortunately, Section 8 tenants have gained a negative image, a negative connotation over time for being management intensive, but that is not entirely accurate.
There is, in fact, a lot that goes into the qualification process, and the only one who has control over that qualification process, it’s you. You can have a horrible tenant in a very luxurious condo.
You can also have a nice tenant in one of those properties. Same thing goes with Section 8. You can have a nice family, someone who’s going to take good care of your property because that person, that family values being in a nice and safe house. That’s, in essence, what you have to do. It is part of your responsibility to vet those tenants right from the get-go so that you can avoid all of those headaches.
How do you get paid by Section 8 tenants?
There are two important things that you need to pay attention to:
1. You have the Section 8 tenant. The way it gets paid is that Section 8 is going to cover one portion of it and you and the tenant are going to cover the other portion of it. So, Section 8 is going to pay a portion of the rent, and then the tenant is going to pay the other portion.
How you decide to collect the money from the tenant, that will be entirely up to you. That’s something that you’re going to have to bill as part of the provision and the lease agreement. Whether it’s by check or direct deposit, you are the one who decides that.
2. Then when it comes to the portion of the rent that you get from Section 8, that becomes a little bit more expensive. There are a couple of things that you’re going to have to follow or abide in order to make things happen.
In each state, each municipality and each area, the requirements are going to vary, but for the most part, the first six items are going to be “mandatory.”
Then there are other requirements that are actually part of the requisites that each local agency is going to ask for. The local agency is the PHA (Public Housing Agency).
Public Housing Agency Requirements
There are some basic requirements that you must meet in Section 8
1. You’re going to have to submit your landlord information form to the PHA who is the administering agency who’s going to process all the payments, all the applications, all of the information that goes back and forth between the tenant and the landlord. You have to submit that form. It basically has your information, who you are, the property.
2. Then it’s going to be the housing assistance payment contact form, which is like the form that you fill up so that way you can get paid, you can provide information about where that payment should be going. How much is it that you expect to receive? How much is it the total rent versus the amount of the voucher that was approved for the tenant? Then, of course, you’re going to have to submit a copy of the lease.
3. Your lease, how long was the lease for with all of the terms.
4. Then the next thing you’re going to submit is the HUD lease addendum. For those who don’t know what HUD means, it basically means Housing and Urban Development. The addendum just basically has additional terms and conditions that everyone needs to abide by, the tenant, and yourself as a landlord. You need to make sure that these two are actually submitted as well.
5. The next thing you’re going to need to submit your W9 so you can actually get paid.
6. And finally, you need to submit the Tenancy Approval form to make sure that the tenant is actually approved to receive Section 8 and also that your house is actually approved so you can start renting it out to those who qualify for Section 8 assistance. Check with your local PHA to make sure what other requirements might be because as you should know, they vary by state.
Section 8 Tenants
Remember, Section 8 tenants are no different in terms of what you collect and rent, it’s pretty much the same as if you’re renting a regular rental apartment. The only thing that varies is the form of payment.
Each person deserves respect and you must be careful not to have discriminatory behavior
Another thing that you have to take into consideration is any type of discriminatory behavior. Some people are discriminatory in nature, but there are other landlords who are discriminatory unconsciously, it’s just simply unconscious bias. Unconscious bias means that you feel a certain type of emotion, a certain type of belief towards certain groups by either sex orientation, gender, religion, and you have to make sure that you are respectful of those, that you have to abide by those.
Section 8 tenants shouldn’t be any different than any other type of regular tenants. The only main difference that I will say you can see here or expect to see here is the form of payment.
Rather than getting all the rent from one tenant-specific now you’re getting a portion of it from the government, from the federal funding and from the federal taxes straight into your pocket, so you can continue to provide housing for that family of low income whether it’s the elderly or just simply families that have someone with a disability in there.
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