Section 8 nightmare!!!!! Please...I need help!!!! - Posted by Cesar

Real Estate Investing Section 8
1

Posted by cesar on November 27, 1999 at 13:24:07:

Thanks for the help and advice. The thing is, we have a manager who handles the properties right now. We bought them when we lived down there and have recently moved to the Orlando area. We have NEVER had one case worker to handle the files, and constantly get shuffled around to other people. We DID speak to the HIGHEST person there, and they solve a problem temporarily, and then the same Sh*t starts happening again!

I am just trying to see if I have any legal recourse whatsoever from anyone who may have had the same experiences and got them solved. Is there a HIGHEST person at Section 8 in Florida that I need to know about? Is there anyone that handles HUD above Section 8? I’ve talked to every supervisor and manager at that office, and they don’t seem to give a d*mn about anything , and don’t even answer their phones most of the time.

2

Section 8 nightmare!!! Please…I need help!!! - Posted by Cesar

Posted by Cesar on November 23, 1999 at 21:30:15:

Not to sound desperate… but I am!!! Let me give out just a little background:

Last year, we got a deal for six townhomes in Florida, in fairly decent shape, for $40K each. They were appraising out at $63K to $70K in March of 1998, so we figured it was a good deal (which it was). We did 80% financing on all six homes and pocketed the difference (and were fairly happy).

This is where the nightmare begins…

4 out of the 6 homes were Section 8. It took them 3 months to get us our first payment, and then assured us that everything would go smoothly after that. Wrong! Almost every month they have been late on their payments, along with a few other problems:

1)They have constant inspections and pick on every tiny little detail to not pass you.
2)when they do find something wrong, they back-date the payment that you were supposed to get and don’t pay you for the month before the inspection
3)they claim to have “internal” problems or miscommunications and “forget” to put your paperwork through the right channels
4)they found out that one of the residents moved out last month and never contacted us about it until this month, and back dated the payments for the property to September!!!
5)every time we call we get transferred to about 6 different voice mails, and then no one gets back to us or the phones are busy for hours at a time

I could keep going on forever. Now, I must ask a question (finally!):

Is any of what they are doing legal? Has anyone had any expeience with them that could help me out? Does anyone know a real estate attorney that might want to pursue the situation? I live in Orlando, and the properties are near Miami (talk about a don’t wanter…) They actually kick out about $250 a month positive cash flow when they are all rented, but I am too far away to be dealing with all this b.s.

Is there any way to turn this around? Should I just give up and try to sell them out? Is there any way I can sue Section 8 for the backpayments or damages they have caused?
Will Batman and Robing survive the Penguin’s electro-freeze?

Can anyone(anyone at all!!) help me?

Thank you in advance for ANY responses or ideas…

3

Re: Section 8 nightmare!!! Please…I need help!!! - Posted by John

Posted by John on November 28, 1999 at 07:53:33:

Cesar I have been trying to contact you, Please Email me with your Phone thanks

4

Re: Section 8 nightmare!!! Please…I need help!!! - Posted by John Tur

Posted by John Tur on November 25, 1999 at 17:17:05:

Cesar let me know what area you have your properties
I move everyday from Florida City, Homestead to Miami Beach, and Broward county. I could give advice according to the area.

5

I ‘second the motion’ to have your r.e. closer to home. - Posted by SusanL.–FL

Posted by SusanL.–FL on November 24, 1999 at 13:32:59:

Obviously, it would be much easier to oversee it yourself.

When I moved to Bradenton (FL) years ago, I still had my condos on the outskirts of Tampa (1 1/2 hrs. away). It was very hard hiring somebody dependable to manage and/or clean my units…so I sold them.

If I were you, I would sell your properties in Miami and reinvest closer to home—that way you will be an active participant in your investment and you won’t be at the mercy of a management company. Personally, I like ‘hands on’—my OWN!! :slight_smile:

6

My experiences with Section 8. - Posted by John J.

Posted by John J. on November 24, 1999 at 10:37:03:

Your side of the story sound desperate. I wonder what their side of the story is or what the tenants would have to say. I have had many Section 8 tenants over the years - and have one now - and not had any major problems. In general these tenants can be a bit rougher on the places than most. So you always have to be on top of your maintenance. Unless you have a maintenance person at or near the property, I do not see how you can be responsive to repairs living that far away. HUD has minimum standard that the units need to meet which the local Housing Authority has to enforce. They can give you a copy of these requirements and a check list. It is my policy that all my units meet these standards and my maintenance people use the check list when getting vacant units ready to rent.

The HA will inspect the unit before a tenant moves in and a contract is signed and then anually about 2 months before renewal. If they come in between these times it is because your tenants call them to complain about problems that are not being taken care of. I don’t know what you mean by: “constant inspections and pick on every tiny little detail to not pass you.” Your units either meet their standards or they do not. Your tenants have reasons to call them to complain or they do not.
Each one of your tenants will have a case worker assigned. You should only deal with these case workers or their supervisors and not be bounced around various voice mails.
Tenants can not just move out unless there are problems with the maintenance of the apartment or the contract has not been renewed. Otherwise it can only be terminated if you sign a release of the contract.
My problem with Section 8 is philosophical: I have seen too many cases where our tax dollars are being used to foster a lifestyle dependent on welfare for people who otherwise would have been very capable of providing for their own needs.
Next time you might consider buying a property closer to home so you can keep it in tip-top shape at all times and when tenants move out you will be the first to know.

7

Yikes… - Posted by Mark (SDCA)

Posted by Mark (SDCA) on November 24, 1999 at 10:11:33:

I have some Section 8 experience and I have never heard anything like this. Let me address what I can…

  1. Inspections. Yah, this is the way. I have actually had an inspector say, “The apt was perfect but I had to find something… so here it is.” I just bite the bullet on this one. What they find IS nit picky. But it costs next to nothing to fix it (a few dollars).

  2. This sounds illegal to me. I typically get X days (like 30) to fix it and request a re-inspection. If it fails the second time, THEN they might stop paying. But not back dating it. I mean how could you know what to fix until they inspect the unit.

  3. Its a bureacracy. Sad but true.

  4. Never heard of this. Why did you and they not know about the move out for months?

  5. Again, a bureacracy. Sorry. I have a caseworker who is specifically assigned to my properties. See if you have the same or can arrange that. At least that way, you are dealing with the same person. (Of course when he is out of the office, I am SOL but oh well…)

The only thing I could think of is that maybe these are onerous regulations for some habitual offender program that you got grandfathered into?? I would ask to speak to a supervisor. Keep going up the ladder till you get to someone with decision making power. HUD is a bureacracy. Those are the breaks. One more thought… Since this is a ditant property I would strongly advise you get an onsite manager. It won’t cost too much mayb 100-200 a month and will be well worth it. Choose the best tenant in the place. Basically, all you want is eyes and ears around the place. (TO tell you when someone moves out for example…)

Hope this helps,

Mark

8

Re: Section 8 nightmare!!! Please…I need help!!! - Posted by cesar

Posted by cesar on November 27, 1999 at 13:43:07:

John,

Thank you for your reply. Sorry it took so long to get back to you, but I was busy with our web site development.

Anyways, the properties are in Carol City, Florida. We picked them up when we lived there and before I got transferred up here last year for work. We owe $54K on them, and they are comping out at about $68K.

If there is anything you can do with them or know someone who may be interested, let me know. Anything over the payoff I will split with whoever gets them sold. I will also accept any offers that may be offered. Even though they are actually Making money, I just don’t have the time or patience to deal with Section 8 or deal with properties so far away from me.

I have some properties up here that I would like to start playing with, and would like to do it without worrying about these.

Actually, the manager for these properties is wonderful, and we would have been screwed without him and his help, and he would be willing to help out whoever buys the properties. He deserves anything that is coming to him for his help.

Any suggestions?

9

Re: I ‘second the motion’ to have your r.e. closer to home. - Posted by cesar

Posted by cesar on November 27, 1999 at 13:37:11:

That is entirely my point, SusanL. We bought these properties when we lived in the South florida area, and have recently moved to the Orlando area because I am developing a web site for a large company here.

I understand what the problems are, we have a manager who is handling all of the repairs at a very reasonable price, and everything else that we CAN do has been done, including staying on hold for OVER ONE HOUR just to talk to someone at Section 8.

What I would like to find out from someone who has had the experience with Section 8 is what I can do to fix it. I AM trying to sell them right now, but I also want to know what kind of legal rights (if any) I have with Section 8 and if there is anything I can do (or someone I can talk to) about the lousy treatment that we have gotten from them since we allowed their tenants to move in. I always thought that it was the landlord’s favor to the HUD to allow Section 8 's to move in, but they seem to think we owe them something.

That’s kind of what I was interested in.