By Molly Grace, Nov 28, 2023, 05:59 IST
In a groundbreaking opportunity for Section 8 voucher program participants, a pathway to homeownership has emerged. Rather than solely assisting with rent payments, the program can now be a stepping stone towards building equity and achieving the dream of owning a home.
What is the Section 8 Homeownership Program?
The Section 8 Homeownership Program, officially known as the Housing Choice Voucher Homeownership Program, allows current Section 8 participants to convert their rental voucher into a homeownership voucher. Instead of subsidizing rent, the program contributes to a portion of the participant’s monthly mortgage payment, requiring homeowners to cover the remainder—typically around 30% of their monthly income.
Eligibility Requirements
To qualify for the Section 8 Homeownership Program, participants must meet specific criteria set by the U.S. Department of Housing and Urban Development (HUD) and the individual public housing agencies. Key requirements include:
1. Current Section 8 Housing Choice Voucher Participation**
2. Minimum Annual Income of $14,500**
3. First-time Homebuyer Status (No home ownership in the last three years)**
4. Minimum 30 Hours of Employment per Week for at Least a Year (unless elderly or disabled)**
5. Participation in Homebuyer Education and Counseling**
6. No Previous Defaults on a Mortgage While Receiving Section 8 Assistance**
7. Compliance with Public Housing Agency’s Rules, which may include a minimum savings balance or credit score**
Benefits and Drawbacks
The Section 8 Homeownership Program offers life-changing advantages for eligible participants. Lisa Lehman, manager of the Michigan State Housing Development Authority (MSHDA) Section 8 Homeownership Program, highlights its potential to stabilize families and provide long-term financial benefits.
Paying a mortgage instead of rent allows participants to build equity, a significant advantage. Additionally, public housing agencies can save substantial amounts by placing individuals in homes rather than rental properties.
However, challenges exist, including limited program availability, underfunding, and understaffing. Meeting credit score requirements and navigating the limited duration of mortgage assistance can be obstacles for very low-income individuals.
Steps to Apply for the Section 8 Homeownership Program
If you’re a current Section 8 voucher holder considering homeownership, follow these steps:
1. Check if your public housing agency offers a Section 8 Homeownership Program.**
2. Ensure you meet eligibility requirements. Work on improving credit, saving, and reducing debt if necessary.**
3. Apply with your public housing agency.**
4. Complete required homeownership education and counseling.**
5. Get preapproved with a mortgage lender and start home shopping.**
6. Once you find a home and have an offer accepted, prepare for closing.**
Frequently Asked Questions
Can you buy a house with Section 8?
*If your public housing agency offers a homeownership option, you may be eligible to purchase a home through the program.*
How does the Section 8 Homeownership Program work?
Section 8 vouchers, initially for rental assistance, can be applied towards mortgage payments through the homeownership program.
Can I buy a house with Section 8 in my state?
Contact your public housing agency or check HUD’s website for information on agencies offering the homeownership program in your state.
This initiative provides an unprecedented chance for Section 8 participants to break free from the cycle of renting and embark on a journey towards homeownership. As the program gains traction, it is anticipated to bring positive changes to the lives of many low-income individuals and families.