What is a rent certificate
Section 8 Rental Certificate Program
The Section 8 Rental Certificate program increases affordable housing choices for very low-income households by allowing families to choose privately owned rental housing. Families apply to a local public housing authority (PHA) or administering governmental agency for a Section 8 certificate. The PHA pays the landlord the difference between 30 percent of the household's adjusted income and the unit's rent.
Several assistance programs exist under Section 8. The Section 8 voucher and certificate programs together help over 1.4 million households in the United States by paying landlords the difference between what the household can afford and the rent for the unit. The administering PHA inspects the housing units to make sure they comply with HUD quality standards. Landlords must agree to accept no more than fair market rent. Certificates are "tenant-based": The qualifying households may use them in any rental unit where the landlord agrees to participate in the program. The assistance provides affordable, decent, safe, and sanitary rental units to low-income families.
Type of Assistance:
The Section 8 certificate program issues certificates to income-qualified households. The PHA then pays the landlord the amount equal to the difference between the tenant portion of the rent (30 percent of adjusted income, 10 percent of gross income, or the portion of welfare assistance designated for housing ) and the contract rent, which must not exceed the HUD-established fair market rent for the area. HUD pays the PHA an administration fee to cover costs of running the program, including accepting and reviewing applications, recertifying eligibility, and inspecting the rental units.
PHAs may apply for funding to operate Section 8 programs. Since the start of the Indian Housing Block Grant program, Indian housing authorities are no longer eligible for Section 8 programs.
HUD contracts with housing authorities to provide Section 8 voucher assistance to very low-income households, households already assisted under the 1937 U.S. Housing Act, and households with incomes up to 80 percent of area median that qualify to receive a voucher in connection with other HUD programs. HUD annually determines median income levels for each area.
system of "portability" allows families to use the assistance outside the boundaries of a particular housing authority's jurisdiction. If a PHA chooses, up to 15 percent of assistance under the Section 8 Rental Certificate program may be place based (used in specific buildings or units developed for the program). Families receiving place-based assistance have no right to continued assistance if they leave the assisted rental unit. However, tenant-based certificates may be used in any qualifying housing unit where the landlord agrees to participate in the program. Certificates could be used for homeownership under Section 8(y), but this has not yet been implemented.
Housing authorities apply for funding by responding to Notices of Funding Availability (NOFAs) published in the Federal Register. Each NOFA identifies allocation areas, amounts of funds available per area, and the selection criteria for rating and ranking applications. Interested households apply to their PHA for Section 8 certificates.
HUD funded an estimated $15.5 billion in fiscal year (FY) 1996, and its funding increased in FY 1997 to $16.7 billion for all Section 8 programs. However, current funding is only for renewals and continued assistance for families in assisted housing. New certificates have been for special purposes only.
The Section 8 Certificate program is authorized by the U.S. Housing Act of 1937 Section 8(b) (1) for existing rental housing and Section 89d)(2) for project-based certificates. Regulations are found in 24 CFR Part 982 for the Voucher and Certificate Program, and Part 983 for the Project-Based Certificate Program. It is administered by HUD's Office of Public and Indian Housing.
For More Information:
Additional information can be obtained by contacting HUD's Office of the Deputy Assistant Secretary for Public and Assisted Housing Operations, Office of Rental Assistance, or visit the HUD Homepage for links to additional information to serve the needs of low-income households.
See Tenant-Based Housing Assistance Works (#6584); Section 8 Rental Voucher and Rental Certificate Utilization Study: Final Report (#6505), Office of Policy Development and Research; or Learning From Each Other: New Ideas for Managing the Section 8 Certificate and Voucher Program (#7341). All are available from HUD USER.Source: portal.hud.gov