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Project-based Section 8 and Section 236/RAP

Program Overview

VHDA, as a HUD contract administrator, monitors and reports owner compliance with the rules and regulations governing Project-based Section 8 and Section 236/RAP programs, as outlined in the HUD Occupancy Handbook 4350.3. This includes collecting household data from the properties and transmitting that information to HUD via iMAX.

If you have any questions or concerns about iMAX, please contact HUD’s Multifamily Help Desk at 800-767-7588 or tracs@hud.gov.

Project-based Section 8
Created in 1968 to provide a rental subsidy to residents of newly constructed or substantially rehabilitated properties. Participating households are required to pay the greater of 10% of their gross annual income or 30% of their adjusted income towards rent. To qualify, a household’s annual income must not exceed the applicable income limit for the area as adjusted by family size.

Section 236
Uses an interest rate subsidy to provide affordable rents to low-income households. Property owners in this program make mortgage payments that are based on a 1% mortgage interest rate. HUD then provides a subsidy to their lender to cover the difference between 1% and the market interest rate on the property's loan. Participating households are required to pay rent equal to the greater of 30% of their adjusted income (not to exceed the market rent) or the basic rent amount set by HUD for that particular property. Any amount paid by the household that is more than basic rent is considered excess rent, which the owner pays back to HUD in repayment of the subsidy.

Rental Assistance Payment (RAP)
Established in 1974 to make units in Section 236 properties affordable to very-low-income tenants. HUD administers the subsidy contract for rental assistance payments. Participating households are required to pay the greater of 10% of their gross annual income or 30% of their adjusted income towards rent.

More Information

 

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