In the U.S., the cost of living increases over time, but wages remain the same. The cost of rent skyrockets, and owning a home imposes challenges that some people in the country end up being homeless. Thankfully, federal funding for affordable housing can assist buyers, homeowners, and renters in the U.S.
If you feel like the budget is tight and you need some assistance to rent or your home’s mortgage, here are some of the government programs you should learn. Let this post guide you on how these government housing programs can benefit you and see the eligibility requirements to know if you’re qualified.
What Is the Role of HUD?
The Department of Housing and Urban Development (HUD) is the federal agency responsible for implementing and enforcing housing policies. The U.S. HUD enforces housing laws, improves housing programs, and provides community development assistance. The goal of HUD is to provide equal housing opportunities for all and decrease the homelessness rate.
The agency aids the local housing agencies to assist low-income residents, find rents they can afford, and provide financial aid. The Department of Housing and Urban Development provides assisted housing programs equally to all without discrimination.
What Is the Section 8 Rental Assistance Program?
The Section 8 Rental Assistance, otherwise known as the Housing Voucher Program, is a government rent assistance program. It is developed to help eligible, low-income U.S. residents pay part or the total amount of their rent in the form of a voucher.
Congress established the Housing and Community Development Act, Section 8 Housing Assistance, in 1974 with the goal of decent homes and suitable living situations for low-income earners, persons with disabilities, and senior citizens other than public housing. As recorded in 2018, 5 million Americans use the rent help voucher in paying for their rent.
Requirements for Section 8 Rental Assistance
The eligibility will be assessed by the local Public Housing Agency (PHA) and is subject for approval. In general, here are the requirements and possible factors that may disqualify a person or family from the housing subsidy or rental assistance program.
- Family Size: The PHA will determine the family size and correlate it to the household’s income to know if a person is qualified. Family members with disabilities and senior citizens are also declared.
- Income Limits: The total household income is less than 50% percent of the median income.
- Citizenship Status: Must be a U.S. citizen or have complete noncitizen requirements. Undocumented immigrants are not allowed.
- History of Evictions: You are ineligible for a Section 8 voucher application if you had a recent eviction from public housing or Section 8 eviction due to criminal drug charges. You may be eligible to apply for Section 8 at least three years after the date of eviction.
To avail of a rent assistance voucher, the eligibility requirements must be met. Once the application gets approved and a voucher is available, look for a house or apartment that accepts them. Depending on the voucher’s coverage, the tenant may pay 30-40% of the rent, but for some, the voucher pays the whole rent. The landlords will receive direct payment from the local housing authority.
Aside from the government’s Section 8 voucher, there is also emergency rent assistance offered by non-profit organizations, private agencies, or religious organizations.
What Is LIHEAP?
Low-Income Home Energy Assistance Program (LIHEAP) is a federal program for financial assistance to qualified households for energy bills or HVAC-related minor repairs. The goal of LIHEAP is to ensure the safety and comfort of families in their homes for all types of climate. The main focus is to make sure that family members remain warm during the winter and comfortable during the summer, without worrying much about skyrocketing energy bills. In general, the LIHEAP is there to assist:
- Financial aid in paying home energy bills
- Emergency services during utility shut down and energy crisis
- Low-cost weatherization or home improvements for an energy-efficient home to lower electric bills.
Requirements for LIHEAP
- To determine if you’re eligible for LIHEAP assistance, contact your local LIHEAP office about the rules and requirements.
- The application will undergo an evaluation and is subject for approval.
- Another option of an automatic grant: If any of the family members in the household have veteran benefits or receives aid from Temporary Assistance for Needy Families (TANF), Supplemental Security Income, or Supplemental Nutrition Assistance Program (SNAP).
What Is an FHA Loan?
A Federal Housing Administration (FHA) loan is a mortgage intended for low or moderate-income earners with a lower down payment and minimum credit scores. The mortgage can be availed through an FHA-approved lender and is more affordable than conventional bank loans. This is a popular type of housing loan for first-time homeowners.
Requirements for an FHA Loan
- Downpayment: At least 3.5%
- Credit Score: A minimum of 580 credit score to qualify. For a credit score between 500 to 579, you can still be qualified for an FHA loan as long as your down payment is 10%.
- Source of Downpayment: The source of downpayment for FHA loans can come from grants for down payment assistance, financial assistance from family or friends, or your savings.
- Borrowers are required to avail of mortgage insurance and the premium payments must be addressed to FHA.
How Can a HUD-Approved Counselor Help You?
Trained and certified housing counselors under the Department of Housing and Urban Development can help you in different ways regarding issues encountered with the government’s housing programs. The HUD-approved counselor is there to assist you when:
- To help when assessing an applicant’s financial situation
- Evaluate and understand the options qualified for an applicant
- Responsible for evaluating if borrowers have difficulty in paying the mortgage loan
- They will help in planning on how residents can get a mortgage
- Counseling that is free of charge on tips for prevention of foreclosure
- Can teach homeowners on the process of buying a home
The Impact of Housing Assistance on Families
Having a roof over your head is a basic human need for survival. Thanks to the government’s affordable housing, other basic needs of families are met, such as food, clothing, medical care, and education rather than spending it all on rent or mortgage. The financial burden for low to moderate-income families eased thanks to the government efforts.