Section 8 Landlords – Beware of Special Rules Limiting Termination of Section 8 Tenancies

Considering going Section 8? Already have Section 8 tenants and they’re starting to cause problems? Are you beginning to consider the irony that the very tenants who have their rent paid by taxpayers are also the ones least respectful of their neighbors?

Not only do Section 8 tenants get 90% or more of their rent paid by the federal government, they have special rights when it comes to terminating their tenancies. Before you make any decision to enter the Section 8 housing assistance program or to evict a Section tenant, you should be aware of the special rules protecting their rights and limiting yours.

Distilled down, federal regulations transform every Section 8 eviction into a “for cause” eviction. Where state law would allow you to terminate most tenancies for any reason, federal law limits your ability to terminate a Section 8 tenancy to certain specified causes. As will be described below, the landlord’s right to terminate Section 8 tenancies is even more limited in the “initial term” of the tenancy. In some states, California for example, a Section 8 tenancy can be terminated without cause. However, such termination can only occur after the initial one-year term of the tenancy and a 90-day notice is required.

Federal law only allows for two unqualified bases for terminating a Section 8 tenancy. First, the landlord may terminate for serious or repeated violations of the terms and conditions of the lease. The failure of the tenant to pay his portion of the rent qualifies as a serious violation of the lease. Second, a landlord may terminate the Section 8 tenancy if the tenant violates federal, state, or local law in connection with his occupancy or use of your premises.

The regulations contain a third ground-“other good cause”- but that ground is qualified. Also, the regulation does not provide an all-encompassing definition of “other good cause” although it does provide four examples. Other good cause includes failure by the tenant to accept a new lease or lease revision, tenant history of disturbing the neighbors or damaging or destroying the premises, owner’s desire to use the premises for personal or family use, or for business-related reasons like sale or renovation of the property.

Recall, however, that the Section 8 landlord cannot terminate for “other good cause” (aside from disturbing the neighbors or damaging the premises) in the “initial term” of the tenancy. The “initial term” of the tenancy is the first year. Thus, in the first year of the tenancy, the landlord can only terminate for non-payment of rent, violations of law, or creating a disturbance or damaging property.

There are three other grounds for terminating a Section 8 tenancy but those grounds must be specified in the lease.

First, you may also terminate a Section 8 tenancy for criminal drug activity occurring on the premises. Second, you may terminate a Section 8 tenancy for other criminal activity that threatens the health, safety, or peaceful enjoyment of other residents or people residing in the immediate vicinity of the premises. Third, you may terminate a Section 8 tenancy if the tenant is a fugitive or is violating a condition of probation or parole. Caveat: Be sure that you include in your lease a provision stating that foregoing conduct constitutes grounds for terminating the lease. If you don’t specify these grounds in your lease, you cannot terminate the Section 8 tenant’s for those reasons.

As a practical matter, terminating a Section 8 tenancy is more complicated for two reasons. First, under California state law, most tenancies are month-to-month and a landlord can terminate them in most instances by just serving a 30-day or 60-day notice and no cause needs to be specified or proven. That option is not available in Section 8 tenancies.

Second, the simplest, most straightforward eviction case is the one based upon non-payment of rent. That ground is almost never available in a Section 8 case. Because Section 8 housing is subsidized, the tenant is nearly always able to pay his paltry share of the rent. Thus, if you want to evict, you’ll have to base the eviction on one of the other causes and that requires proof. Therefore, eviction trials are always more complicated (particularly if the Section 8 tenant has a lawyer in which case you’re probably looking at a jury trial) in Section 8 cases because it will involve witnesses, photos, videos, and pre-trial discovery.

The upside to being a Section 8 landlord is that your rent is guaranteed. You can count on full payment of rent every month. In San Diego, there is a shortage of Section 8 housing so landlords can also count on a decent rental rate from HUD. But there are other factors to consider relating to the quality of tenant and the complications involved in separating from the problem tenant.



Source by Howard F Burns

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