In the July 2006 On-Site Northwest newsletter of MrLandlord.com, a write-in landlord in the management tips, entitled, "When Section 8 Fails to Pay", gave the following advice:
"I use to get stuck with an uncollectible debt when Section 8 quits or fails to pay the rent for a resident who had been participating in the program. Now I require all Section 8 tenants to have the financial ability to pay the entire rent even if it means bringing me a cosigner for the lease. Haven't had a payment collection problem since."
Due to this recent article,HUD is posting these helpful reminders regarding Section 8 and the institution of minimum income restrictions:
- Section 4-7 E.3. of the 4350.3 clearly states: "In the Section 8, RAP [236 Rental Assistance Program, most of which have converted to Loan Management Set Asides], and Rent Supplement programs, owners may not establish a minimum income requirement for applicants." (The only exception noted is for Section 236 and Section 221 (d)(3) BMIR applicants who receive no other form of assistance and can be screened for ability to pay Section 236 basic rent or the BMIR rent).
- Section 4-8 A.1-4 of the 4350.3, further states that the prohibition against specific minimum income, along with other federal, state or local fair housing and civil rights laws regarding prohibited screening criteria "apply to (1) accepting and processing applications; (2) selecting tenants from among eligible applicants on the waiting list; (3) assigning units; (4) certifying and recertifying eligibility for assistance; and (5) all other aspects of continued occupancy."
- Complaints alleging use of such prohibited screening criteria will be referred to HUD's Regional Office of Fair Housing and Equal Opportunity, as outlined in Section 4-8 A.4.
- While the 4350.3 does not provide guidance for the tenant-based Section 8 program, now called the Housing Choice Voucher program, many cities have fair housing laws in place that prohibit discrimination on the basis of income, participation in the Section 8 program, and receipt of federal housing assistance. Landlords should consult legal counsel before establishing criteria that could be determined discriminatory under federal, state, or local fair housing and civil rights laws.
- As a general rule, Section 8 does not "quit" or "fail to pay" without reason or notice. If a landlord or owner experiences problems receiving project-based Section 8 payment, he/she should contact their HUD Project Manager or call the general HUD Multifamily line at (206) 220-5228. If the problem is with receiving payment on a Housing Choice voucher, a landlord or owner should consult their local housing authority to determine if or when payment should be made.
Questions regarding Section 8 subsidy should be directed to your Performance-Based Contract Administrator