How Does The Birmingham Section 8 Process Work?

We receive a lot of questions from my owners asking ‘How Does The Birmingham Section 8 Process Work?’

Here is a quick rundown of the steps involved in getting a home approved for Section 8 after the lease is signed.

Sign Lease and Request for Tenancy Approval (RFTA)

The RFTA is a package of information the Housing Authority requests to be filled out. It mostly asks questions about the home, but it also provides important disclosures regarding the steps below.

Once this is completed we forward the following information via FedEx to the Housing Authority caseworker:

• Copy of the lease
• RFTA paperwork
• W9 form
• Proof of property ownership
• Our management agreement

Tenant Income Verification

Once the Housing Authority receives this information, they go through an income verification process. This step usually takes the longest, because the caseworker typically becomes an information gatherer.

Once they gather all the information and load it into the system, the system generates a number. This number is the “Maximum Allowable Rent” amount for this tenant.

As long as the “Maximum Allowable Rent” is more than the amount we are asking, the file will move to the next step.

In some cases, the “Maximum Allowable Rent” amount is less than the amount we are asking. In that case, they will send us a notice and require us to accept or decline that lower rental amount.

When we receive this notice, our team will contact you and discuss the amount. If you choose to accept the new amount, then we move to the next step.

If you do not accept it, we must begin the marketing process over again.

Inspection

Once the file passes the income verification stage it goes to the inspection department.

The inspection department will call us and book an appointment to see the home. At the appointment, the inspector goes through a checklist of items to pass or fail per HUD guidelines and regulations.

Any item that does not pass these guidelines and regulations is a “failure”. If one item fails, the whole unit fails.

A failed unit is given 7 days to remedy the issues and then is re-inspected. Ideally, we would like to pass on the first inspection.

Comparable Analysis

Once the unit passes the inspection it is sent back to the caseworker for comparative analysis. This is an analysis of similar units in the area.

They compare your unit to other units much like a real estate appraisal – features, location, monthly rental amount, etc. – to come up with an acceptable monthly rental rate.

If the comparable data shows that we are asking what it considers to be a fair price for the home, then it passes. If the comparable data says that what we are asking is higher than the data suggests, then it will generate an acceptable rental amount.

Then much like #2, we are notified of the “Maximum Allowable Rent” based on the comparable data. We can choose to accept this new amount or decline it. Declining, once again, means starting the marketing process over.

Sign HAP Paperwork

The last step in the process is the signing of the Housing Assistance Payments (HAP) contract. The Housing Authority will typically not allow a tenant to move in prior to this step’s completion.

The HAP contract is an addendum to our lease and supersedes the lease on areas where they differ. It defines the relationship between us, the tenant and the Housing Authority.

Move-in

Once this paperwork is complete, we will hand the tenant the keys to the home and allow them to move-in.

The biggest question I get is, “How long does this process take from start to finish.” The answer is . . . “It depends.”

A good guestimate is 4 – 6 six weeks. However, we’ve had instances where the process lasted a week and some have lasted many months.

We hope this article answers the question, “How does Birmingham Section 8 work?”

Matthew Whitaker

Matthew is the CEO of Evernest. He is a student of the book Good to Great and is passionate about building the best property management company on the planet (and maybe even the universe if Elon Musk will hurry up). You can usually find Matthew at the baseball field with his son, at a dance recital with his daughter, or at his favorite restaurant with his wife, when he’s not in the office. And if you can’t find him in any of those places, it probably means he’s traveling.