Housing discrimination is a complex and sensitive issue, particularly regarding Section 8 vouchers. Many landlords face a tough balancing act. They must control their properties and choose tenants carefully. Yet, they also need to follow fair housing laws and avoid discriminating against voucher holders.

While there are legitimate reasons to deny a Section 8 applicant, it’s not always clear what’s legal and what’s not. That’s why you need to understand the rules and regulations surrounding the Section 8 program. A misstep in this area can lead to significant fines and legal challenges.

Do landlords have to accept section 8? In this article, we’ll explore the specifics of legally denying Section 8 applicants. We’ll look at valid grounds for rejection, the documentation needed to protect yourself, and the mistakes to avoid at all costs so you can protect your business while staying within the law.

For a rental screening process where you don’t have to worry about compliance, check out Rentzap’s fully managed application underwriting. We vet potential tenants based on standardized and compliant criteria so you can focus on managing your properties.

Understanding Section 8

The Section 8 program, officially called the Housing Choice Voucher Program, is a federal program meant to help low-income individuals and families find affordable housing. Run by the Department of Housing and Urban Development (HUD), this program provides vouchers that cover around 70% of the rent while the tenant pays the remaining 30%.

Authorities directly give Section 8 vouchers to eligible individuals and families rather than tying them to specific properties. These voucher holders can then use them to rent approved housing units from landlords who have agreed to accept the vouchers as part of the rental payment.

A local public housing agency manages the Section 8 program in their areas, determining eligibility, issuing vouchers, and overseeing the program. Factors such as income level, family size, and other criteria set by HUD determine eligibility.

Are property managers required to accept Section 8 tenants?

One common question that rental property owners and managers ask is whether they are legally required to accept tenants who have Section 8 vouchers. The answer is not direct and depends on the specific laws in your area.

At the federal level, the Fair Housing Act (FHA) does not prevent landlords from discriminating against prospective tenants for participating in the housing choice voucher program. While there isn’t a federal law, several states and cities have passed their own fair housing laws that protect individuals with Section 8 vouchers. These local and state laws fall under categories like source of income or public assistance status discrimination.

There are currently 17 states with source-of-income discrimination laws, and numerous cities and counties have also passed regulations.

Understanding source of income discrimination

Source of income discrimination is when applicants cannot get housing or services due to where their income comes from. This includes landlords rejecting tenants whose income stems from government aid, social security, pensions, child support, or other legal sources. Anti-discrimination laws seek to treat all income sources equally. They aim to allow everyone access to housing, regardless of how they earn their money.

Housing discrimination laws

Laws against source of income discrimination typically include several key provisions to protect individuals from being denied housing based on where their income comes from. These provisions generally include:

• Definition of protected income sources: The laws define what constitutes a protected source of income. Protected income sources include government benefits like Social Security, disability, and veterans’ benefits. They also cover Section 8 vouchers, alimony, child support, scholarships, and grants. Essentially, they are any legal income used for housing and living expenses.

• Prohibition of discrimination: They explicitly prohibit landlords and property managers from refusing to rent, lease, or sell housing to individuals based on the source of their income. This means that a landlord cannot deny an application solely because a portion or all of the tenant’s income comes from one of the protected sources.

• Advertising: The laws often address advertising practices, making it illegal to include language in housing ads that would exclude potential tenants based on the source of their income, such as stating “No Section 8” or “no public assistance” rental listings.

• Equal treatment: These laws mandate equal treatment for all applicants. They forbid extra requirements or higher standards for those with government assistance or non-wage income.

• Reasonable accommodations: In some jurisdictions, laws may require landlords to make reasonable accommodations in policies or practices to facilitate equal opportunity for people using various income sources to obtain housing. This might include, for instance, modifying rent due dates to align with the timing of benefit payments.

• Enforcement and penalties: The laws establish mechanisms for enforcement and detail the penalties for violations. This could involve filing complaints with housing authorities or human rights commissions. Offending landlords may face fines, pay damages, or incur other penalties.

• Exceptions and Limitations: Some laws may include exceptions or limitations. For example, small private landlords who own a limited number of units and live on the property may be exempt in certain areas.

Avoiding fair housing liability

Whether you choose to accept or deny Section 8 tenants, be sure to handle the process in a way that follows fair housing laws and avoids discriminatory practices. Here are some tips to help you avoid potential housing discrimination issues:

You don’t have to accept every applicant with Section 8 vouchers

Even where Section 8 discrimination is banned, you can reject applicants for valid reasons. These reasons must be non-discriminatory and apply to all. Examples include failing to meet minimum income requirements, poor rental history, criminal background issues, or not meeting other set criteria.

Do not use stricter screening criteria on Section 8 applicants

Imposing stricter criteria or extra hurdles for Section 8 applicants is discriminatory. It unfairly targets them due to their voucher status. Such actions likely break fair housing laws where income source discrimination is illegal. Always use the same screening for all, voucher or not. Judge every application by identical standards without adding extra requirements for voucher holders.

Avoid directing Section 8 applicants toward specific properties

Steering applicants based on their voucher status is housing discrimination. It’s illegal to only offer certain units or areas to Section 8 applicants, as this restricts their choices and fosters segregation. Provide equal access to all units and avoid any form of steering. This maintains fairness and prevents limiting opportunities due to voucher status.

Don’t discriminate based on other protected classes

You might deny Section 8 tenants in some places, but linking this to protected classes like race or religion breaks fair housing laws. Make sure decisions on Section 8 tenants rely on objective criteria like meeting rental qualifications and lease terms. Discriminating against protected classes is illegal and risks legal action.

Maintain consistency in your Section 8 rental policies

To prevent housing discrimination, confirm consistent application and communication of your Section 8 policy by all staff. Inconsistent treatment, like denying some applicants while accepting others with similar qualifications, can lead to discrimination claims.

Document policies and train your team regularly on these practices. Consistent policies safeguard against fair housing claims and demonstrate a commitment to equal housing.

Section 8 screening compliance

Rentzap offers a clear path from application to approval, verifying legal compliance for property managers. Our approach to resident screening fits federal and local housing laws and provides operational efficiency. Key components include:

Compliance

Rentzap features standardized rental screening criteria that confirms fair treatment of applications, aligning with the Fair Housing Act and local laws.

Verification of documentation

Rentzap streamlines the management and verification of applicant documentation to expedite the application process. This speeds up decision-making and offers property managers protection against fraudulent applications. You can be confident that we’ll spot fake bank statements or paystubs.

Technology and expertise

Rentzap’s technology efficiently processes applications while human underwriters apply their expertise to interpret the data. This is an underwriting process similar to mortgage approvals, which provides you with the best-qualified renter for your properties.

Wrapping up on if landlords have to accept Section 8?

The rules regarding Section 8 tenants vary because of the different laws by jurisdiction. As a property manager, you should be aware of your rights, responsibilities, and the potential impacts of your decisions regarding accepting or denying Section 8 voucher holders.

Consider the benefits and risks of the Section 8 program carefully. Take into account factors like your location, property type, operational capabilities, and long-term goals before making a decision.

Focus on creating standardized rental application criteria to confirm transparency and consistency. This approach aligns with business objectives and helps avoid legal issues and fair housing violations.

FAQ on landlords accepting Section 8 vouchers

Can you decline Section 8 in California?

California does have source of income discrimination laws, but you don’t have to accept tenants with Section 8 housing vouchers if they don’t meet your rental criteria.

Are landlords required to accept Section 8 Ohio?

Ohio doesn’t have a statewide law against income source discrimination or mandatory acceptance of Section 8 vouchers. But certain Ohio cities and counties have local ordinances around source of income. Property managers should review relevant state and local laws to understand Section 8 acceptance requirements in their area.

Do I have to waive deposits for voucher recipients?

No, unless specified by law, you do not have to reduce or waive your right to collect a deposit.