There are two Section 8 programs. You must apply for the voucher. There is
usually a long wanting list, possibly two or more years. Some Public Housing
Authorities have a lottery system. The vouchers are referred to as Housing
Choice Vouchers.
The first type is a rental voucher that allows you to choose you own home in
the jurisdiction of the Public Housing Authority. The rental property must
be inspected and approved by the Housing Authority.
The second voucher allows you to use the monthly subsidy as mortgage
payments in stead of rental payments. The down payment required is 3% of
which 1% must be from the applicants own funds. The other 2% can be from a
Government Approved source of subsidies or a gift from family members. The
subsidy can also be used to pay closing costs and prepayments (Taxes and
Insurance Escrow). The Section 8 Housing Choice Voucher Payments are good
for fifteen (15) years unless the applicant is Elderly or Disabled. It is
then good for life.
To qualify for the purchase using a Housing Choice Voucher, the applicant
must have a full time job for a minimum of one year working at least 2,000
hours. They must also have the voucher as a rental voucher for a minimum of
one year. They must apply and be approved for a first mortgage, usually FHA.
The applicant will make a payment of 30% of their gross income to the
Mortgage Company. The Housing Authority will pay the balance of the monthly
payment including taxes, insurance, and any Condominium or Home Association
fees.
Every year the applicate must furnish the Housing Authority with financial
information. The monthly payments are then adjusted to the families new
income for the next year. In the event of a reduction of income during the
year, the applicant can appeal to the Housing Authority for an early
adjustment based on the reduced income.
The Voucher can be transferred from one Housing Authority to another. As an
example, the applicant presently lives in New York and moves to Miami, the
voucher can be transferred from the New York Houisng Authority to the Miami
Housing Authority.
Not every Housing Authority has instigated the Housing Choice Purchase
program. The applicant must check with the local Housing Authority for their
present program.