Homeownership

Section 8 Homeownership Voucher Program

The basic idea of the Section 8 Homeownership Voucher Program is to use the money from a regular Section 8 rental voucher to help a family buy a home or meet monthly homeownership expenses.

Not all housing authorities offer the homeownership option as part of their voucher program.

In order to use the program, you have to have a Section 8 voucher. If you do not currently have a voucher, you must go through the same application process as if you wanted to apply for a Section 8 rental voucher.

Once you have a voucher, and if your housing authority offers the Section 8 homeownership program, you can begin looking for a housing unit to buy.

Once you find a housing unit to buy, the housing authority will make the monthly homeownership assistance payment for you. The housing authority may make the payment to the lender directly or to your household.

The amount of the subsidy for the homeownership program is the same amount as your rental voucher would have been.

Eligibility

The program is administered by local housing authorities. You must be a current voucher program participant, or eligible for admission for the Housing Choice Voucher Program. No member of your household can currently own a home, or have owned one in the last three years.

If the family includes a person with a disability, the housing authority may determine that the use of the homeownership option is necessary as a reasonable accommodation. The housing authority may determine that the use of the homeownership option is necessary as a reasonable accommodation.

There is a full-time employment requirement for families that are not disabled or elderly. This does not apply to disabled families. Disabled families can meet income requirements through the money they get from monthly Supplemental Security Income (SSI) payments.

If any adult family member previously received homeownership assistance and then defaulted on the mortgage, the family will not be eligible for homeownership assistance.

In order to be eligible, you must attend and complete a homeownership counseling program that is required by the housing authority.

Finding a Home

The housing authority may have time limits for you to find and buy a home. But the housing authority may not steer or restrict your search to certain sellers or neighborhoods.

Before you finish buying your home, the housing authority will conduct a housing quality standard inspection to make sure that the condition of the home is decent, safe, and sanitary. The unit must also be inspected by an independent professional that you choose and hire.

Also, before you finish buying the home, you must give a contract of sale to the housing authority. Be sure to check with the housing authority about specific details that must be included in the contract.

A housing authority cannot require that you use a specific lender, but it may make requirements about lending terms and the price of the home you can buy. The housing authority can also require that you follow certain rules in order to continue to receive assistance.

However, for a disabled family, as long as you do all the things that the housing authority requires, there is no time limit to how long the assistance can last.

Foreclosure Prevention

Overview

The first step to getting help is to call 1-888-995-HOPE (4673).

If you are having trouble paying your mortgage, there are several programs that can help you. The first step to getting help is to call 1-888-995-HOPE (4673). This is a hotline that is available to any homeowner in America having trouble paying their mortgage. It is open 24 hours a day, 7 days a week.

When you call 1-888-995-HOPE you will get absolutely free foreclosure prevention counseling by expert counselors at HUD-approved agencies. When you call you will get help immediately - the counselors themselves answer the phone.

Other Resources

There are many resources in Minnesota that can help you prevent foreclosure:

Individual Development Accounts

Overview

Minnesotans who are considered low income can build assets to purchase a home using an Individual Development Account (IDA), operated by Family Assets for Independence in Minnesota (FAIM).

Participants who contribute a specified monthly amount (up to a maximum of $480/year) receive a matching amount from state and federal funds of $3 for every $1 you contribute.

If you participate for the full two years of the program, and you contribute the maximum amount ($480/year x 2 years = $960) with the government match ($960 x 3 = $2,880), you could save up to $3,840.

Eligibility

Eligibility requirements to participate in an IDA include:
  • Low income
  • No bankruptcies, defaulted student loans, or tax liens
  • Participants must have earned income other than SSDI or SSI

You must use IDA funds for:

  • Education (tuition and fees)
  • Small business start up or expansion
  • Home purchase (down payment or closing).Must be first home, or haven’t owned in three or more years

To participate in the program you must also attend required classes in financial management, as well as classes that specifically relate to your use of the funds, such as first time homebuyer, business development or career development courses.

Learn more about home ownership of Housing Benefits 101.