If you have low income and know how much you can afford for a rental property, you’ve likely discovered that it can be challenging to find suitable apartments to fit your budget. Fortunately, the government provides money to agencies and building owners enabling them to offer low-income housing opportunities.

There are two main types of affordable rental housing that you can explore – Section 42 and Section 8 housing. The Department of Housing and Urban Development (HUD) oversees and helps implement these programs. But what are they exactly?

Section 42 Housing

Section 42 housing – the low-income housing tax credit program – was created to incentivize developers to build apartments for individuals with low income. The government matches the developer’s contributions to ensure the developer doesn’t charge over a certain amount in rent each month.

These units are designated for households who earn 30 to 60 percent of the median income in their area. Rent on these apartments is fixed, and the maximum amount of rent is determined by the county that the apartment is located in. Those who qualify for the program can rent a unit or a single-family home built by the developer.

Section 8 Housing

The Section 8 housing program, also known as Housing Choice Vouchers, provides vouchers to low-income residents to offset the cost between what HUD calculates as the maximum rent for the area and what the resident can afford. The rent will be based on 30 percent of the resident’s household income.

Once you qualify for a Housing Choice Voucher, you find your own housing. You can rent an apartment, townhouse or single-family home as long as it meets health and safety standards.

The eligibility and application process

Interested residents will need to apply to HUD for each program and qualify before receiving assistance. HUD determines the maximum income allowed for each county, city and major metropolitan area across the U.S. Whether or not you’re eligible will depend on the income restrictions set in your area.

The application process is quite lengthy – be prepared for a lot of gathering documents and filling out paperwork. HUD will want to know every single asset and income source you have available to you to assess your eligibility including child support, pension and social security just to name a few. Income eligibility is determined by looking at the total household income from all household members over the age of 18.

Finding the perfect apartment can sometimes be overwhelming, especially if you’re working with a smaller budget. But there are options available to you. If it sounds like you could qualify for one of the affordable housing programs, get started today by contacting the public housing agency in your state.

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