Transferring Rent for Section 8 Property

Transferring Rent for Section 8 Property

Member since 2020 · 13 posts · 0 votes

I'm in the process of closing on a section 8 duplex. I've started the process of gathering the paperwork for the local housing authority to have rent payments redirected from the seller to me, but it takes time. We close on December 16th, which gives me four days to get paperwork in, just to have rent redirected to the following month, in January. The seller has already received December rent ($3,200), meaning we should be entitled to half of that. If we don't get all the documents filed within the four days following closing, we'll lose out on another month, bumping the total up to $4,800 (half of December and January).

Is there something that can be done during closing to ensure we receive the rent for the time that we have ownership of the property? I have a question out to my realtor now but am anxious over it since it's a good bit of money and we are responsible for collecting it from the seller instead of the housing authority.

0Reply
17 views

1 Reply

Jump to latestLatest
  • Rental Property Investor · Saint Louis, MO · Member since 2018 · 228 posts · 279 votes
    5y

    @Mallory Thompson 

    You will get half of the rent through the settlement done by the title company. You won't go collect it directly from the seller.  So you're good there.  You'll also get credit for the security deposits.

    As for the Housing Authority, I submit the paperwork ASAP following the sale & request that all payments to the previous owner be stopped (here, by email) and follow up daily until I have been given confirmation that it's been processed.

    If the payments do go to the previous landlord after the sale, immediately notify the HA. As long as you have done your part, they will make those payments back up (and require the previous owner to pay them back).

    I'd recommend requesting the most recent Notice of Change (the document that lays out the amount of rent and how much the HA and tenant pays), which the current landlord should have. It will also tell the recert dates. Then make sure that the ledgers you're getting match those amounts (it's easiest if the PM or landlord keeps a separate ledger for tenant and HA but a lot do not and it can take some detective work to decipher which payments are which).

    Section 8 is a great program when executed well. A lot of landlords and PMs don't like it because it is some additional paperwork and it's very process oriented. I think the positives far outweigh the negatives. I have some blogs here on BP that may give you more insight if you're looking for more.

    Good luck!

Join the conversationCreate a free account to reply, vote on answers and follow this thread.