Low-income housing offers rents that are much easier for tenants to handle, as well as government vouchers that will pay for part of the rent in certain types of low-income housing. Most people are familiar with Section 8, but gaining low-income housing and paying rent there goes beyond just having the landlord sign up for the Section 8 program. You also may have to choose your type of rent, and you'll definitely have to report your income every year. You may have a choice between income-based rent and flat rent, and while flat rent has a lot of benefits, you do need to be aware of how it works in real life.
You Still Have to Report Changes in Income
Flat rent often requires a re-evaluation of income every three years instead of every year. But even if you're lucky enough to have a three-year break in between evaluations, you may still have to report changes in income during those three years. If most of your income is from fixed sources, you might not have strict reporting requirements, but that will vary from complex to complex and depend on exactly what those income sources are. The upshot is that you can't assume that you'll be able to absorb a huge income increase in year two and hide it from the management.
You Can't Lower Flat Rent
Once flat rent is set, it's set. That means that if your income drops to the point where even the flat rent is hard to pay, you can't redo your flat-rent agreement. You do have the option of converting your flat rent to income-based rent, with economic hardship as the reason. But if you have a rapidly changing income that could drop at any time, you may want to look at the income-based rental option to begin with. Flat rents are great when you know your income will be fairly steady.
You Might Still See Rent Increases
Flat rent can still go up, which is likely one of the most frustrating parts of flat rent. Each apartment has a fair market rent recorded with Section 8. If the fair market rent goes up, the flat rent can go up because the flat rent is based on a percentage of the rent. So, if you're not concerned about the fair market rent increasing, flat rent could work for you. If you don't want to risk an increase, or if you live in an area where fair market rents are skyrocketing, ask what the rents would be for income-based and flat-rent based if there were an increase so that you can compare which would be better for you if the fair market rent were to go up.
The management at the complexes you apply to can walk you through the application process and help you figure out which type of rent would be best. The management is there to help and ensure that you can stay in housing as long as you qualify.
Share9 August 2019
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