Potential Section 8 tenant, unsure of how to proceed on 1st deal

[Hannah White]

Good morning BP,

This is my first post and I will try to be concise. I bought my first SFH a couple months ago with intention of doing long term rentals. I have been doing showings/marketing for over a month and gotten only a handful of actual applications. I have no experience with Section 8. But I have an applicant that I approved that has housing vouchers. My current rent price is set at $1,500/mo for a 3b/2ba with garage. The tenants vouchers are for $1,211/mo. I was under the assumption that the housing authority pays the voucher amount and the tenant covers the rest to meet the $1,500 rent price. The HA representative told me today the the $1,211 is the governments portion and the tenants portion combined.

The tenant has enough income to pay her amount of the voucher and the extra needed for my listed rent price, plus other living expenses, decent credit score and good background check. My concern is this: essentially the tenant would be paying me under the table for the remaining rent not covered by the voucher. I had intended to sign a separate contract from the HA lease with the tenant. This is probably a horrible idea, but since I have no landlording experience whatsoever I am in need of some direction please. I believe my judgement may be clouded by the fact that I have had zero decent quality tenants apply in over a month and have had trouble filling the vacancy. I am also concerned that I could get into legal trouble with the FHA for getting more rent from the tenant than would be contracted. But I have not been able to find any information of a situation like this online.

Can anyone please help me out? And let me know if I can clarify any information I may have forgot to include. Thank you!

[Malkia Ra]

1. With Section 8 vouchers the tenant pays the difference between the voucher and your monthly rent amount.  In your case, tenant should be paying $289 a month.  "The HA representative told me today the the $1,211 is the governments portion and the tenants portion combined."  This is inaccurate; however I if I'm wrong, the tenant cannot afford a rental above $1,211 which means they simply do not qualify for your rental and you should hold off until a better applicant comes along.

Nothing should ever be done under the table.  Everything should be spelled-out in the lease.  Your rent amount is $1,500 and that's that.

2. Is your rental in a decent area and is $1,500 market rent for that area?  The answers to this could possibly explain why you haven't received better applicants.