The Beginner’s Guide to Affordable Housing

When you think of affordable housing, things such as housing projects or public housing may come to mind. While it’s true that these programs are options for people who need to save money on rent, the concept of affordable housing is more complex.

According to the U.S. Department of Housing and Urban Development (HUD), housing is considered “affordable” when you only pay 30 percent of your income or less on your rent or mortgage.

Under HUD’s definition, you are cost-burdened if you pay more than this amount on housing expenses.

Being cost-burdened means that it is often difficult to afford basic necessities such as food, clothing, medical care or transportation.

Because housing is so crucial, it often takes priority over other needs regardless of how much it costs.  

Learn About the Need for Affordable Housing

Millions of Americans are cost-burdened due to their housing expenses. According to HUD, a family with one person working full-time at minimum wage cannot afford a two-bedroom apartment anywhere in the U.S., even at the local fair market rate for rent. 

In fact, it’s estimated that 12 million households in the U.S. pay more than 50 percent of their income on rent, making them severely burdened by their housing expenses. 

How does funding work for affordable housing?

Each year, the federal government puts billions of dollars toward programs for low-income households.

This funding is made available to government agencies, public housing agencies (PHAs) and other similar organizations that provide rental assistance programs.

Once PHAs receive these funds, they are responsible for distributing benefits to qualifying households.

After these funds run out, PHAs generally cannot award additional funds to applicants until they receive additional funding the following year.

As a result, there is usually a greater number of people who need benefits than there are funds to distribute, especially for programs like Section 8.

Find Out About the Types of Affordable Housing Programs

Homeowners and renters alike can face issues with housing expenses. However, HUD and other government agencies provide a variety of resources to help families afford their basic housing needs. For example, low-income families can qualify for rent assistance programs such as the following: 

HUD provides various resources for homebuyers as well, such as insured mortgages that can make it easier for families to qualify for a loan.

There are also programs that help public housing residents or individuals enrolled in rental assistance programs to qualify for loans and become homeowners.

People who already own a home can also benefit from various homeowner programs that make it easier to manage a mortgage and other expenses. 

For example, HUD-approved housing counseling can be an effective tool for many families who need to save money. There are also programs that help homeowners afford repairs and modifications, as well as resources for avoiding foreclosure. 

Who can qualify for affordable housing?

Because there are so many different affordable housing options, the qualifications for each program can vary greatly. 

In general, eligibility is based mostly on income. For many rental assistance programs, a family needs to earn less than 80 percent of the median area income.

Sometimes, income limits require households to make even less, such as 50 or 30 percent of the median income.

While the exact requirements vary by program, you can get a better idea of the limits by referencing HUD’s income guidelines. These limits do not apply to every program, but they can still be used for general information. 

Other factors can play a role in your eligibility as well. For example, the following things might impact whether you can qualify for a particular program: 

  • Legal presence in the U.S 
  • Family composition 
  • Whether you have a Social Security Number (SSN)
  • Homeownership history 
  • Criminal history 
  • History with other housing assistance programs 

Am I guaranteed to get assistance if I’m qualified?

Unfortunately, because there is such a great need for affordable housing, there simply isn’t enough funding available to help every eligible family. In fact, only one quarter of qualified families actually receive help from federally-assisted housing programs.

If you’re found to be eligible to enroll in a program and there aren’t enough funds to give you the support you need, you will likely be placed on a waitlist. This is especially common for programs such as Section 8. During this time, you will be unable to receive program assistance until funds become available. 

How do affordable housing programs work?

If you are cost-burdened by your housing expenses, you may qualify for any number of programs. Because there are so many different types of affordable housing programs, the steps for receiving assistance can vary greatly. 

In most cases, you will need to start by identifying the government agency or local organization that is in charge of administering the program you want to use.

This may be HUD, a local PHA, the Department of Veterans Affairs (VA), the U.S. Department of Agriculture (USDA) or a different agency altogether.

Once you identify a program you would like to enroll in, it is necessary to fill out an application with the appropriate agency or department.

The process of getting assistance may include the following steps, depending on the program:

  • Submitting documents that prove your eligibility 
  • Sharing basic information on your household members, such as names, dates of birth and SSNs 
  • Providing evidence of your income 
  • Signing a rent agreement or mortgage contract 
  • Moving into a new unit where you can use your housing assistance 
  • Undergoing an annual review to verify you are still eligible 

How to Find Affordable Housing Options

There are many opportunities for affordable housing throughout the United States. Knowing where to start can be overwhelming, but HUD provides a variety of resources by state to help you begin. Each state has programs for rental assistance, homebuying and homeownership. 

Keep in mind that the types of programs you can enroll in may vary depending on where you live.

However, in most cases, you can apply for some form of affordable housing anywhere you choose, regardless of where you live in the U.S.

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