Can It Help You Buy a Home?
The Section 8 Housing Choice Voucher Program gives low-income renters assistance with their monthly rental costs. The program eases the headaches of renting and eases concerns of not being able to purchase under Section 8.
With approval from the local Public Housing Agency, families may use their Section 8 vouchers to buy a home. Although the Homeownership Voucher Program is not available in every territory, The Department of Housing and Urban Development (HUD) compiled a list of housing agencies offering the program, available online.
Families already using the Housing Choice Voucher program may easily switch to the Homeownership Voucher Program once they find a modest home they’d like to buy. Anyone who does not currently participate in the Housing Choice Voucher Program must complete an application at their local PHA if they meet eligibility requirements.
Individuals must meet family income requirements without exceeding the monthly income amount, be elderly or disabled, work full time, and attend housing counseling as designated by the housing authorities in their area to qualify for this program. Each housing agency sets forth the rental and program requirements.
The home a family wishes to purchase must pass an initial housing inspection by the PHA and an independent housing inspection. The latter inspection is paid for by the potential homebuyer. Homeownership is possible once you find the right real estate!
If the home meets the initial requirements, you can move forward with the purchase. Your voucher covers monthly mortgage payments each month. Homebuyers must meet other requirements set forth by the seller. This includes qualifying for a mortgage and placing a down payment on the home.
Families without great credit or extra money to use for the down payment may get one step closer to homeownership by using a rent-to-own program. Many families face such a situation, but rent-to-own can certainly help.
What is Rent to Own?
Rent-to-own eases the headaches of coming up with a huge down payment to move into the home. After signing an option lease, rent to own buyers pays a small option fee. Then, within three years, renters have the option to buy the home. Some of the money paid each month toward rent is applied to the down payment, further easing the hardships that so many people face when it is time to buy a home. Buyers also have time to improve their credit score and make other arrangements to prepare for homeownership. To learn more read this guide.
Can You Rent to Own With Section 8?
Section 8 rental vouchers are accepted for rent to own contracts. During the initial period, you are renting the home, after all. That’s what Section 8 checks for during their inspections. You may continue to use the rental voucher while renting the home.
Once the rental period expires on the rent to own deal, transfer your voucher to the Homeownership Voucher Program for assistance with your mortgage payments once you buy. Sign a 30-year-mortgage for 20 years of support from the Homeownership Choice Voucher Program.
Contact the PHA well in advance of the home purchase to transfer your voucher to the Homeownership Voucher Program. This ensures the PHA has the proper time for inspections and transfers to take place before your lease expires on the home.
Homeownership is possible for low-income families with the help offered from the Housing Choice Homeownership Voucher Program that will pay a portion of the mortgage each month. Taking advantage of this program simplifies the homeownership process for families with limited incomes. The money that you earn can be used to improve the home, pay bills, and otherwise take care of things necessary for comfortable living.
Related: What are the pros and cons of RTO?