Section 8 Homeownership

The Housing Authority of Washington County allows some of our Section 8 rental assistance money to be used to promote homeownership. HAWC’s homeownership option is designed to promote and support homeownership by a ‘‘first-time’’ home-buyer, allowing Section 8 payments to supplement a family’s own income to facilitate a transition from rental to homeownership. The initial availability of these assistance payments can not only help the family pay the costs of homeownership, but may provide the additional assurance for a lender, so that the family can obtain needed financing.

The Section 8 homeownership option is open to families who have been living in a HAWC-assisted unit for at least 12 months, whether that be in the Section 8 rental assistance program, public housing, or another Housing Authority of Washington County owned or managed property. Because of funding limitations, only 5% of the HAWC vouchers can be utilized for homeownership at any one time.

Persons interested in the Section 8 Homeownership Option should contact the Section 8 Coordinator to receive further information about the Homeownership Program and a Homeownership Application.

To be eligible a first-time home buyer must be employed (though the employment requirement does not apply to an elderly family or a disabled family). For “employed families” the combined family income must be over the Federal minimum hourly wage multiplied by 2,000 hours (not counting any welfare assistance income). In addition the applicant head of household, spouse or adult on the mortgage document must remain continuously employed (no less than 30 hours per week) while participating in the program. Continuous employment will be defined as: “No gap in employment lasting more than four weeks total during the past year.” (HAWC has the discretion to allow small gaps in employment resulting from loss of employment resulting from measures beyond the employee’s control (layoff, medical emergency, etc.) which do not result in an employment gap of more than four consecutive weeks.) In the case of disabled families, the minimum income must be equal to the monthly Federal Supplemental Security Income (SSI) for an individual living alone (or paying his or her share of food and housing costs) multiplied by twelve.

Applicants for the home ownership program are not required to participate in HAWC’s Family Self Sufficiency ("FSS") program in order to participate in the home ownership program. However, in the event the applications for home ownership assistance exceed five percent (5%) of HAWC’s total voucher program in any fiscal year, FSS participants shall have a preference for participation. Participants in an Individual Development Account ("IDA") program administered by an agency other than HAWC also will receive a preference for home ownership assistance in the event applicants for home ownership assistance exceed the 5% limitation.

Before the commencement of homeownership assistance for a family, the family must attend and satisfactorily complete a pre-assistance homeownership and housing counseling program required by the Housing Authority of Washington County (pre-assistance counseling). The counseling will be conducted by a HUD-approved counseling agency. The required pre-assistance counseling program will cover home maintenance (including care of the grounds); budgeting and money management; credit counseling; how to negotiate the purchase price of a home; how to obtain homeownership financing and loan preapprovals, including a description of types of financing that may be available, and the pros and cons of different types of financing; how to find a home, including information about homeownership opportunities, schools, and transportation; advantages of purchasing a home in an area that does not have a high concentration of low-income families and how to locate homes in such areas; information on fair housing, including fair housing lending and local fair housing enforcement agencies; and information about the Real Estate Settlement Procedures Act (RESPA), state and Federal truth-in-lending laws, and how to identify and avoid loans with oppressive terms and conditions.

The Housing Authority of Washington County will also offer additional counseling after commencement of homeownership assistance (ongoing counseling). This counseling will be voluntary for all homeownership assistance recipients except those requesting their second, fourteenth and fifteenth years of assistance. The reason for this mandatory counseling is to make sure the families are either off to a good start or preparing for the termination of their assistance.

Home Inspections. HAWC will not begin homeownership assistance for a family until it has inspected the unit and has determined that the unit passes HQS. Prior to closing, the unit must also be inspected by an independent professional inspector selected by and paid by the family. The independent inspection must cover major building systems and components, including foundation and structure, housing interior and exterior, and the roofing, plumbing, electrical, and heating systems. The independent inspector must be qualified to report on property conditions, including major building systems and components. The independent inspector shall be certified by the American Society of Home Inspectors or one whose inspections are accepted by three local lenders. It shall be the responsibility of the inspector to verify that the inspector meets this certification qualification.

The independent inspector must provide a copy of the inspection report both to the family and to HAWC. The housing authority will not commence homeownership assistance for the family until it has reviewed the inspection report of the independent inspector. Even if the unit otherwise complies with the HQS (and may qualify for assistance under the Housing Authority of Washington County's tenant-based rental voucher program), the housing authority shall have discretion to disapprove the unit for assistance under the homeownership option because of information in the inspection report.

A purchasing family must invest at least three percent of the purchase price of the home they are buying in the property. This can take the form of either a down payment, closing costs, or a combination of the two. Of this sum, at least one percent of the purchase price must come from the family’s personal resources.

Section 8 Homeownership assistance will only be paid while the family is residing in the home. If the family moves out of the home, the Housing Authority of Washington County will not continue homeownership assistance after the month when the family moves out. The family must attend and complete ongoing homeownership and housing counseling before the end of the first, thirteenth and fourteenth years of assistance in order for assistance to continue. As long as the family is receiving homeownership assistance, the unit must be the family's only residence. Except for elderly families or those whose head of household or spouse experience permanent disability, the applicant head of household or spouse must remain continuously employed (no less than 30 hours per week) while participating in the program.

Except in the case of a family that qualifies as an elderly or disabled family, family members will not receive homeownership assistance for more than fifteen years if the initial mortgage incurred to finance purchase of the home has a term of 20 years or longer; or ten years, in all other cases. The “elderly” exception only applies if the family qualified as an “elderly” family at the start of homeownership assistance. Whereas in the case of a disabled family, the exception applies if at any time during receipt of homeownership assistance the family qualifies as a disabled family. On the other hand, if during the course of homeownership assistance, the family ceases to qualify as a disabled or elderly family, the maximum term becomes applicable from the date homeownership assistance commenced. However, such a family must be provided at least 6 months of homeownership assistance after the maximum term becomes applicable (provided the family is otherwise eligible to receive homeownership assistance in accordance with this program).

At any time, the Housing Authority of Washington County may deny or terminate homeownership assistance in accordance with the same rules at it utilizes for the Section 8 rental assistance program. For additional information, contact the Section 8 Coordinator at extension 205.