What types of tenants may rent my property?
Belgrave Group utilise different schemes within the USA for placing tenants into the unique investment properties available through us.
Below you will find useful information on these different schemes and the advantages of using them.
Section 8
Perhaps the most well known rental program run by the department of Housing and Urban Development (HUD) is the Section 8 program. Our Property Management teams have placed hundreds of tenants through this program and have become extremely efficient in utilising it. Section 8 tenants are given a voucher depending on their family size and income statistics. When a potential Section 8 tenant becomes available, the property managers will ask for their moving packet and voucher info. The voucher details the number of bedrooms the tenant is eligible for, and this helps the property managers to determine if the tenant is suitable for a particular home. The tenant then submits a moving packet to be reviewed by the housing commission. The commission then contacts the property management to let them know the total amount of the subsidy payment that will be paid. Based on that amount, plus the tenant portion, the property managers decide if the rent is appropriate for that property. If a section 8 tenant(s) must pay a tenant portion, the property managers evaluate their other income to determine if they are able to pay that amount.
Advantages: The obvious advantage of placing a Section 8 tenant is receiving government guaranteed income on a monthly basis. Also, Section 8 tenants are not given a timetable to relocate. Generally these tenants stay several years at the same property.
Cash Tenant
If the property management has a potential cash tenant, they evaluate each tenant based on income and rental history. The tenant would visit the property managers office for an interview, during which they make copies of their ID and Social Security cards. The property managers then ask if they have any type of government aid, such as disability, unemployment, or supplemental income (SSI). This type of aid provides a tenant with a stable income that they receive on a monthly basis. If a tenant claims such income, the property managers require documented proof from the relevant services. The property managers will request for check stubs and employment verification from each tenant. Private tenants that are not backed by an organisation must have passed the property managements rigorous screening package. Therefore, they are employed or have sufficient documented benefits, have not been evicted from previous rented properties, no criminal background upon relevant checks, satisfactory references from past landlords and a credible credit score. If a tenant has been evicted or has had trouble paying their rent in the past, this would raise legitimate concern.
Advantages: The property managers have found that properly screened cash tenants maintain the property very well. Furthermore, some cash paying tenants also receive government-related income. State provided Cash Assistance and Social Security payments are just two of these programs. This type of government income is advantageous because it does not expire. There is no time limit for a family receiving cash assistance.
Neighbourhood Legal Services
Another program paid for by government grants. The process is similar to Section 8, however there are minor differences. The length of the contract is 12-18 months, after which there is a re-evaluation period.
Advantages: This commission pays the entire amount of the monthly rent. As opposed to Section 8, NLS vendors offer a much larger percentage of the monthly rent. Tenants enrolled in this program need immediate housing, so the inspection takes place in a very prompt manner.
From the property managers experience the above tenants are expected to stay in their property for several years. Most rental markets fall short of this, more likely to be 6-12 months. The above information has been provided by the Property Management Companies that Belgrave Group use, if you would like a full list of the property managers used please click on the following link;