My first property to get a tenant with a Section 8 HUD voucher
Out of the 38 properties I’ve managed to accumulate in this business, I must say that my favorite is definitely the one that is currently occupied by a tenant with a Section 8 voucher. The rent is always paid on the first of the month via direct deposit into my bank account and I never hear from the tenant except for the one time each month when she calls to see if I recieved her $100 check in the mail. The Department of Housing and Urban Development (HUD) pays her rent, or at least most of it and she is left with a small payment amount of $100 each month to me to cover the rent that the government won’t pay. So far this has worked out very well for me.
About ten months ago, I was approached by a lady named Stephanie who was needing a place to stay and was looking for a 2 bedroom house or apartment for her and her daughter. She currently lived in an apartment in the next town over that was in a bad side of town and was looking for somewhere more safe to move into. I normally have at least one or two properties vacant at any given time and it just happened that I had two available for her to look at. I showed her the first and she told me it would be too far out of town to live and so I took her to the one located right in the middle of town, which she fell in love with immediately. She told me that she had a Section 8 voucher for government assistance and wondered if I would accept her because of it.
Now before this, I had only heard about Section 8 or HUD vouchers or whatever you want to call them just a few times previously and to be honest, I had no clue if I could or if I should accept the voucher. So I told her I would be glad to have her as a tenant if only I knew what was required of me as a Landlord in order to receive Section 8 vouchers. She told me that it’s not too much hassle on my part (and she was right!) and that the property I was showing her was well within HUD’s standards to lease out to her. I agreed to rent the property to her and she made a phone call to her case worker to set up an appointment for us to show him the property.
A few days later, I received a phone call from some lady that works for the government who was calling on behalf of the HUD inspector and she confirmed a day and time for him to come by. I met him and Stephanie at the house on the day of our appointment and he had a clipboard in hand. I was sort of nervous about it and wondering if my property would be verbally abused in the process of his walkthrough but to my surprise there was little he had to say about it. I had to fix one window that had been painted shut many years ago (it was a safety concern) and supply a new fire extinguisher (doh! How could I miss that?). He gave me a week to get the repairs completed (even though it was taken care of the same hour he left) and returned after 7 days to my approved house.
We handled the paperwork right there in the kitchen. I was signing document after document. I felt like I was joining the Army again! All I had to do was supply a lease agreement that I normally had my tenants sign before moving in. He brought the rest of the contract paperwork. After 20 minutes of signing and explaining the position of the HUD/Section 8 standpoint, he left and I had my first tenant with a HUD voucher! I was glad to join the club. Stephanie has turned out to be a really great tenant and always has a pleasant way about her (I would be too if I only had to pay $100 rent each month!) . The rent for her particular house is $550 a month but HUD will only pay $450 so she is left with the balance of $100 each month which she always pays in a timely manner.
Even if Stephanie had turned out to be a rotten tenant and skipped town in the middle of the night, the government would continue to pay the rent on the property until I found a new tenant to replace her. The lease is typically for one year on a HUD backed property and it can be renewed as long as the tenant is willing to remain after the year is up. So far Stephanie has talked about sticking around for a long time and I hope to keep it that way!
13 Responses “My first property to get a tenant with a Section 8 HUD voucher”
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HUD sounds like a real life saver!
Really,it is very informative…I never knew that.gr8 post!
This is great! I’ve read through several entries on this blog and you not only have good information, but you have the personal experience which is so valuable! I noticed in one of your entries you mentioned the army? Did you aquire your properties while in the army? I’m really interested in doing this, but I’m unsure as to how to go about it. Thanks for this great information!
Yes steacher! I started planning to purchase rental properties while overseas in Iraq. I used to be a traditional National Guardsman who only worked one weekend a month until I was deployed for 18 months. I tried my best to save every penny and when I came home I started investing in rentals. Since then, I have taken a job as a full time National Guard recruiter (so don’t quit your day job….yet!) and I continue to invest in rental properties to this day. Eventually I will leave the military and focus strictly on being a Landlord, but until then….I encourage everyone to get on the band wagon. It’s a great way to build wealth on the side!
This is something I would like to look into … How does one go about signing up a property for Section 8?
I was hoping to eventually purchase properties and use them to collect
a steady stream of income through renting,
and this is a nice story in which to
look at all methods of renters.
Great article and very touching story. Very informative way of informing people of HUD and how it works but also, how you are helping others less fortunate.
It is nice to hear a landlord say something nice about their tenant. Very well written. I am on ehow under Janiek13 and I left my blog url for my blog.
WorkHomeUnion,
You can either contact the HUD/Section 8 Department directly and have them send someone over to your property and inspect it ahead of time, or you can wait until you have a tenant with a Section 8 voucher in hand before you have the inspection. Either way, it’s a free inspection done by the Department and it must be done sooner or later. Although, I do think it has to be done within so many days of the tenant moving in, so don’t think you can get your house or apartment approved six months in advance and still hope to get someone in without a follow-up. Thanks for dropping by.
Hi Jake, bless your heart. My Son currently serves in the Army as an SPC. Military Police on Ft. Bliss in Texas, but will soon be deployed to Iraq in July.
Thank you for your positive messages in regards to Section 8.
Just FYI, its now called the Housing Choice Voucher. The Section 8 term has a real bad stigma to the name, so they changed it to make it sound more inviting fresh and new, but it isn’t.
Now I’m going to be the devils advocate here.
Its not always rosie in the flower garden, sometimes they wilt and die.
What I mean is, I am glad you are having a great experience with it, but be a skeptic. It’s ok. I know this, because I have been on the program for 12 years, as a tenant.
All Voucher tenants aren’t as good as Stephanie.
But know this, The Voucher Program has really become strict with their requirements. Now, if you are affilliated with a gang, ever been convicted for gang activities, or if someone in you family is involved in any gangs, you can and will loose your voucher. Ditto, involving Drugs. You can’t even have a criminal background.
But, still, every now and then, you will get that tenant that will try your patients.
Also, it all depends on where you own property and who is handling the distribution of monies involving rent and building inspection.
I live in the innercity of Chicago, and it is a nightmare here, for both Landlords and Tenants.
My poor Landlady has been duked out of hundreds of dollars in rents from housing for the most trivial of matters.
She has a young daughter, and Housing seems to like making appointments for her, during times she has to devote to her daughter, like taking her to school and picking her up, so which sometimes makes her late for her appointments, and then they say she isn’t cooperating. So she then will at some point get penalized for it.
Even though in many ways I would classify her as a slumlord, cause she doesn’t like to fix things in a timely manner, and the building is in bad shape for the most part, because she uses really cheap labor to fix things. You will get what you pay for.
But, the fact is, she can only work within her means.
Chicago’s “CHANGE” Voucher Substitiy facillity isn’t the only colprit. My County has one of their own, and they’re pretty bad too.
You may be one of the lucky ones who may have property in an area that knows how to manage and be responcible. For that, I send you blessings. Some places are really irresponcible.
It is a good thing to do, if you want extra money on the side, threated with foreclosures, or consistant cash flow.
I’m glad you wrote this, because many people don’t know much about it, and for tenants like me, I struggle to find a place to live, because of ignorance. Maybe we both should write a piece together, you as the Landlord, and me as a Section 8 Tenant, and give the perspectives of bothsides.
Anyway, since I got the chance, I’m gonna run with it.
I am looking to leave and move out of Chicago with my 13 year old daughter next summer. We have a Voucher. I am looking for a top notch High School.She is an awesome student. She is interested in Drama Disaplines.
Good Luck Jake. And again, thanks for the write.
Thanks so much for posting this…you have a great website. God bless and hope you have had a great Thanksgiving.
That’s awesome I am glad to hear things are working out for you and the tenant.
Thank you for accepting Stephenie as a tennent