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Change of Ownership? What about the Section 8 Tenant?

Bundling Tenants

Change of Ownership occurs frequently among real estate investors. One of the most successful investment strategies for real estate investors that sell properties for a living is bundling the tenant with the sale of the property. Why? Here are some valid reasons:

  • Instant Cash Flow. Hopefully the previous owner had the property cash flowing before you bought the property. Make sure you crunch the numbers.
  • No hassles with finding a tenant. Application processing…advertising costs…
  • No rehabbing costs.
  • No lost rental payments. Usually takes 90 days to find a tenant.
Florida City Section 8 Property

Florida City Section 8 or Plan Ocho Property.

 

Both the BUYER and SELLER like the idea of the tenant being bundled with the sale of the property. BUT…..What happens when the investment property is subsidized by HUD's Section 8 or Plan Ocho program? Is this going to be a problem when the property changes ownership for the new owner?

The BUYER and SELLER must take the appropriate steps for a smooth transaction with no problems. Here are some of the potential problems you can avoid:

  • Section 8 rental check will be sent to the old owner.
  • Check will be made out to the old owner.
  • Tax problem. Old owner will be liable for taxes on a property he no longer owns.

Change of Ownership

When a property that is subsidized by HUD’s Housing Choice Voucher HCV (Section Eight) program is changing ownership the Local Housing Authority must be notified to ensure payments are sent to the proper owner.

To do this transfer, the new owner must schedule an appointment to fill out the “Change of Ownership Package“. In order to complete this package you will need the following documents:

  • Recorded Warranty Deed. If it is available.
  • Settlement Statement if Warranty Deed is not available.
  • Social Security Number or Employee Identification Number EIN.
  • Driver License.

Once these papers have been processed, the new owner should start receiving their monthly rental checks.

Written by

A review of what happens when there is a change of ownership of a Section 8 property.
Miami-Dade County
Miami, Florida
33133
US
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About Bob Burns
Bob Burns profile picture at Women's Council of Realtors.
Bob Burns

Bob Burns is an international technology executive with years of experience stimulating growth and increasing revenue through the design and implementation of marketing strategies and product applications for various markets. Adept at forming strategic business alliances, introducing new products and maintaining superior customer satisfaction.

Skilled at blending technological expertise with business acumen to drive growth and operating efficiencies. Proficient in a variety of data structures using various content management systems CMS.

An effective communicator and trainer in both English and Spanish, experienced in bringing together people, processes and technology.

For more information go to Bob Burns LinkedIn Profile.
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June 8, 2012 · Bob Burns · No Comments
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