Sec 8 Deposits
I have my first property listed with the local Sec 8 office. It is a fully re-habbed 3 bedroom (small rooms) in a pretty solid lower income area. I have it listed for $600/mo with a $600 deposit. It's only been on the list a week so I'm not too concerned but my friend and counseler is adamant that I'm not getting many calls due to the deposit being too high. He (and a few others) have said that it would cost me more than the deposit in court costs to keep it (even for valid reasons) at the end of the lease because the Housing Authority makes it very difficult and that I should ask for no more than a $250 deposit otherwise all I am doing is keeping the majority of prospective Sec 8 tenants from even looking. My initial thoughts were that even if I couldn't keep the deposit without great difficulty, the simple fact that a Sec 8 recipient (sp?) could come up with the deposit would tell me alot about what kind of person I was renting too. Any thoughts? Should I lower the deposit and get someone in there?
Thanks!
Believe me, they will tell you that your deposit is too high if it is $100.00.
However, when the tenant moves out and leaves the place trashed, Sec. 8 will do nothing, and then scold you for not having a higher deposit. Personal experience.
I don't do Sec. 8 anymore for this very reason. They don't stand behind their tenants to keep the trash out.
You might also want to include in your lease "No vehicle is permitted to be parked on or around the premises that is not in working condition or in compliance with road rules and regulations".
This way they don't leave a junk vehicle that you can't have towed away because the tenant can't be held responsible due to lack of funds to fix the car. This could take months. Personal experience.
I have been blessed to never have had a problem with section 8, but I understand that it could happen.
Here in Austin, I usually ask for 1/2 month's rent as a deposit, if they are section 8. The section 8 office here has nothing to do with deposits or anyhting concerned with them (damage etc.) However, when I was in California, it was an entirely different situation, as is the program I have for my property in North Dakota.
Therefore I suggest you talk to your local section 8 office, or better yet other section 8 landlords in your town to see how things are handled there.
Good Luck !
[addsig]
I have had a few Section 8 tenants and have a couple of units currently in the Section 8 program. My Section 8 tenants have never had a problem coming up with the full security deposit equal to one month's rent.
If they can't pay the deposit, then I am not obligated to take them as a tenant. Even though my rental market is getting a little soft right now, qualified applicants can still produce a full security deposit in addition to the first month rent.
To all that responded....Thanks for you help!
Question for JoanAlyce1:
If you ask 1/2 month's rent for deposit from Section 8 tenants, what are you able to get from others?
Frank
I thought that you would want to hear from the horse's mouth about your deposit requirment for Section 8 holders. Let's try to remember that most "honest" Section 8 holders do not have $800 in savings somewhere because if they are on public assistance they are not allowed to have that type of money. They are in poverty. There are some non-profits that help people with getting deposits, but thoses are few and far between even for a homeless family. (Ask me how I know)
Personl experience talking here.
In my area ( and this comes from a person inside the section 8 office) a person having financial difficulties can come up with the deposit from a multitude of places Ex. welfare office, united way, community action, salvation armyand the list goes on. The security deposit is your security blanket what do you feel safe to cover damages or other liabilitys your stuck with.
ED
My last security deposit was paid for by Catholis Social Services...........My wife was apaulled. That our church contribution were paying deposits on appartments for prople. To me it was $550.. and nothing more I would rather they get the deposit fram an agenccy rather than selling drug to get it.
Why don't you try to call Social Services. This is different than sec 8. They are backed by the state, not local government.
I had a house approved by social services and they agreed to give me two months rent as security.
Also, decide what you want for rent and stand by that number. When Social Services was looking at my house, they offered me $200 less than what we finally agreed upon. Good Luck!
I purchased a 4-unit building which is 100% rented to tenants on housing assistance. When we closed escrow, the tenants security deposits were transferred to me and I was surprised at how HIGH they were. The previous owner managed to get a full month's rent for security deposit from EACH AND EVERY tenant, and for one of the units, that equals $1850. I am not sure how they come up with this money to be honest, but one month's rent is the standard from what I have heard from other Section 8 landlords.
Let me give you my personal experience with section 8 tenants. Check them like you would any other tenant (credit,work, and criminal). You have the choice of who you rent to. I have been renting through the section 8 program for 25 years,and some of my tenants were here when I bought the houses. If you keep your houses up you will have very few tenant problems. As far as deposits anything over $100.00 will be a stretch. Section 8 tenants tend to stay an average of 5 years.