Section 8 Security Deposit Rules Explained: Who Has to Pay?

[00:00:00]All right, welcome to our channel.

[00:00:01]Today, we're going to be discussing Section 8 uh security deposit rules.

[00:00:07]And I'm going to explain everything for you. I'm going to also kind of align this with about 12 of the most common steps to help you guys out.

[00:00:15]There's a lot of uh information that may not be that useful. So, I I tend to go towards things that I know will actually benefit you. Now, before we get started, my name is Jay. I'm the owner of section8consulting.com. And today, I'm going to switch screens real quick. That way, I can get you on the right page.

[00:00:31]So, I'll move a few things around. There we go.

[00:00:34]And you can see me here. I'm going to move my little old face around a little bit. And then, we're going to bring in some notes. For those of you that have learning disabilities or otherwise, or maybe you believe I move a little too quick in my conversation, this will allow you the opportunity to follow along. As we do this, I will also put the notes in the description as well as the comment section. If it's too long, then I'll likely just do the comment section, okay? So, first up, number one. Can a Section 8 landlord require a security deposit? Yes, a private landlord can, participating in a housing choice voucher program, may require a security deposit. Remember, deposits are the option of the owner of the property. Uh you know, the feds cannot uh claim jurisdiction over deposits. So, however, the landlord generally cannot charge a voucher holder more simply because uh the person receives Section 8 assistance. So, it Whatever's good for the goose is good for the gander. That means whether you're Section 8 or not, uh it has to be the same for everybody.

[00:01:26]Uh so, this would be under HUD's regulation. The local PHA agency uh may prohibit a deposit that exceeds ordinary private market practices in the area, exceeds deposits charged to the landlord's unassisted tenants, and uh violate state or local security deposit limits. And this also includes uh additional charges imposed uh which should only uh only because an applicant has a voucher. Again, so, no discrimination of voucher. You can read about the applicable laws under Title 24 CFR 982.313.

[00:01:58]And again, you can find that in the notes below.

[00:02:00]Number two, does Section 8 pay the security deposit? Usually no. Let me Let me clarify that. I know after doing this 26 years working at the federal level, no. Okay? They're not going to pay it.

[00:02:11]And they're also not going to pay your moving costs. So, the housing assistance payment made by the housing authorities intended to help cover monthly rent. Uh it does not ordinarily cover security deposits, utility deposits, moving expenses, application fees, furniture, household supplies, and tenant portion of the first month's rent if that's the security deposit, okay?

[00:02:33]So, the government will help you with the housing, but it's not going to fix all your problems.

[00:02:37]Moving on from there, the housing authority normally does not collect the deposit or hold it on the tenant's behalf as well. And the security deposit is generally an agreement between the tenant and the landlord cuz you're under a contract in an actual lease for a real home or property. That's between you and the landlord. Number three, how much can the landlord charge? Well, there's no simple nationwide deposit limit for every Section 8 tenancy, but the permitted amount depends on federal voucher regulations. Number two, the housing authority's administrative plan, which you can request under FOIA and I highly recommend if you do a Freedom of Information Act and request that information you do it digitally and not by copies because they will charge you for it, okay? Number four, the city or count county ordinances may not permit it or landlord's normal policy for unassisted tenants.

[00:03:24]Moving from there, for example, a state may limit the security deposit to one or two months rent. Other states may not impose the same statewide. So, you need to check. No matter where you live in the country, you need to check, okay?

[00:03:36]Number four, can the housing authority limit the deposit? Well, yes, but it in certain ways, not always. So, as a HUD ruling on June 2025, uh the Housing Choice Voucher guidelines states that housing authorities must adopt the policy limiting the deposit to the amount common charge in private rental markets or the amount that the landlord charges unassisted tenants. Unassisted means people that have a job and no voucher, okay? That means they work at a job, they're paying their rent out their own pocket. Tenants and landlords should never review the housing authority's current administrative plan before the signing of the lease.

[00:04:11]So, that's good advice. Number five.

[00:04:13]Can a landlord Can a landlord charge more because the tenant has Section 8?

[00:04:17]And again, I think we've kind of addressed that. So, we'll skip to number six. Is [snorts] the security deposit based on the full rent or the tenant portion? I'm going to tell you right off the top, that's going to be on the basis of what the landlord chooses to do. However, there are limitations to that. It depends on state law and the lease and the housing authority's policy, which you can find under their administrative plan by requesting that through FOIA or Freedom of Information Act. A landlord may not attempt to calculate deposit using the full contract contract rent rather than the only tenant's monthly portion.

[00:04:48]Federal HCV regulations do not establish one universal calculation method for every jurisdiction. So, it's important to check with each. So, as an example, a contract rent at 1,500, second of that would be housing authority payment of 1,100, a tenant portion of 400, and landlord's uh stated deposit at 1,500.

[00:05:05]If the 1,500 of deposit is not automatically prohibited simply because the tenant pays 400 monthly, it must still comply with state local laws and market practices. The housing authority's policy and the amount charged to comparable unassisted tenants, meaning people that have a job and do not use a voucher.

[00:05:24]And number seven, when we must When must the deposit be paid? Well, the landlord may require the deposit before giving the tenant possession of the unit. In other words, you sign a lease and of course you pay up along with the PHA.

[00:05:36]However, the parties should avoid uh paying a nonrefundable deposit or signing a binding lease before the housing authority approves this. That is typically done under HQL so housing quality inspection and then there's a newer system that I'll be moving into which I'll be speaking about in future videos. So the the quest for tenancy approval, the proposed rent, the unit, the lease and the housing assistance payment contract is what we're deferring to and the tenant should obtain a written confirmation stating whether the payment is refundable if the housing authority denies unit or proposed rent. Number eight, can the deposit be paid in installments? Federal eight Well, I should say >> [laughter] >> federal law and section eight rules do not require every landlord to accept installments. Nevertheless, installment agreements may be permitted or required under state law and as well as local tenant protection ordinances and the housing authority policies. In addition to that, a voluntary written agreement with the landlord could also be applicable in that circumstance and any payment arrangement should be documented in writing and should state the amount each of each the payment and and the due dates for each as well as uh also the consequences for the missing payments as well. So I'm sorry I skipped on that one.

[00:06:53]>> [snorts] >> Uh number nine, moving out.

[00:06:55]May the landlord deduct the move out costs? Subject state and local law, landlord may generally use the deposit for amounts of tenant the tenant owes under the leasing including unpaid tenant rents, tenant caused damage beyond ordinary wear and tear, sorry, unpaid utilities for which the tenant is responsible and other lawful charges authorized by the lease itself. In other words, contractual agreement under half contract. Examples of the ordinary wear and tear may include lightly worn carpet, minor wall scuffs and ordinary fading or large holes, broken doors, unauthorized alterations, a series of pet damage may also be treated differently. Look guys, the best the best way to defend both the tenant and landlord's position is before the unit is actually leased or anybody does anything, that both parties make an active recording of the operation and use of everything in there to ensure everything's working, that there's an established condition on move-in that should be met at when you move out. That should be videotaped by both you and the landlord at the same time to prevent any allegations. Moving on, number 11, does the housing authority reimburse the landlord for damages? Generally, no, not under the Housing Choice Voucher Program. The housing authority's uh housing assistance program does not operate as damage insurance, and most of you may be required to get apartment insurance additionally if you rent that way.

[00:08:17]If the deposit is insufficient, landlord generally must pursue the tenant using the same lawful collection procedures that apply to other renters. In other words, to other renters, and must also meet federal rules. Some housing authorities, state state and local programs, separately offer landlord incentives and damage mitigation funds or vacancy loss protection.

[00:08:38]So, there are some exceptions nationwide where they offer uh additional incentives. Those incentives mean that uh if you're a landlord and you take on a tenant, then they potentially will cover damages and other things like that. So, think of it as a kind of an insurance, though it's not real insurance, okay?

[00:08:55]Uh number 12, and this will be our final one. Uh and then the after number 12, I will post all the rest as well in the contentious list we're going to put in the comments section and description just to be clear. What happens when the voucher holder transfers to another unit? The original landlord must handle the existing deposit according to the lease and the applicable state law.

[00:09:14]Uh Moving from there, the tenant may therefore need a new deposit before receiving the refund for the previous property. Uh the time uh this timing uh problem is one of the reasons tenants should seek the deposit assistance early in the moving process, including those of you that decide to use uh portability, okay, to another state where you're moving. So, uh down payment assistance also can be uh, applicable to those that may be trying to do home ownership program whether through HUD or independently.

[00:09:43]All right, guys. I've enjoyed talking with you and as always, I usually run through these videos fairly quickly because nobody likes a long-winded person. Uh, you can again find our information, the phone number, uh, the website as well as the email. Keep in mind my appoint- my office is by appointment. Those appointments cost money and they're not that much. I think they're 20 minutes is about $45.

[00:10:04]Uh, please do not personally call my office. These videos are for free and that's my time I'm giving for free. I'm not going to do that personally on my phone, okay? So, uh, no hard feelings there. Just contact our office by phone if if you, you know, you want to book an appointment. But if not, then continue on. I've got 2,000 videos. There's plenty of information out there or you may call 211 or 311 for one per free assistance, okay?

[00:10:28]All right, guys. I've enjoyed making the video and I hope to see you again tomorrow morning. We'll be doing a live video, uh, if if this video is still relevant and not a year or two old.

[00:10:38]All right. Bye for now.