Today’s senior housing looks very different from the “retirement homes” of our grandparents’ years. Many older adults are choosing to move to senior housing and independent living apartments long before they need assistance. They’re looking for a sense of community and the safety of knowing help is nearby if they need it. But independent living and assisted living communities are expensive. If you’re considering senior housing, will your income be an issue?
It might be — especially regarding low-income housing. The rules and regulations can often be confusing for prospective renters. And ironically, it seems that while some people don’t qualify because they don’t have enough money coming in, others may be turned down because their earnings exceed the maximum allowed.
What qualifies as income?
One of the biggest questions regarding rental eligibility is what is considered “income.” In market-rate apartments, it’s more flexible. They basically want to know if you have enough to pay your monthly rent. Generally, there are no hard and fast rules when it comes to senior “market value” complexes; landlords are free to charge what the market will bear. And it’s up to each owner what financial information they require or accept from applicants. Many assisted living communities require a certain amount of assets on hand, but most apartments do not.
Qualifying for low-income housing is a bit stricter as guidelines are set up by the Department of Housing and Urban Development (HUD). The two most common programs are Section 8 and Section 42.
Section 8 was designed to help low-income families — including seniors — find decent, affordable housing. This federal program is administered locally by public housing agencies (PHAs) that award HUD funds to eligible recipients in the form of a voucher. To qualify, your income (or total family earnings for couples) can’t be more than 30% of the median income in your area.
Section 42 income eligibility is determined by HUD for each individual county or metropolitan area. The reduced rent for qualified applicants comes from rent credits the government offers to investors that build affordable housing.
Your Gross Income Is What Matters Most
The most important thing to know is that the number used to determine “income” for both programs is your gross income (the amount of money you make before taxes and other deductions such as Medicare). For those that come out just a little below or above that number, it can be frustrating. Unfortunately, HUD guidelines don’t allow any limit flexibility from landlords.
The following items are generally counted as income:
- Social Security (SSI) — minus any monthly overpayments due to extra earnings
- Social Security Disability Income (SSDI)
- Earnings from work — such as wages from part-time employment or regular self-employment income
- Tips and commissions
- Pension payments
- Income from assets such as property, interest or dividends
- Alimony
- Withdrawal of cash or assets from IRAs or investments
Common exclusions:
- Food Stamps
- Fuel assistance
- Inheritance
- Sporadic income (e.g., for occasional odd jobs that can’t be counted on)
How to Prove Your Income
And finally… now that you know what ’s considered income, how do you prove it if you no longer get a pay stub? Here are some commonly accepted options:
- A Social Security or SSDI “benefits verification letter” (easily obtainable online, by phone, or at your local Social Security office)
- A W2 from your employer
- A 1099 form showing any freelance or self-employment income
- A pension letter or pension distribution statement showing regular pension payments
- A copy of your most recent tax returns
- Statements showing current assets of bank accounts, IRAs, and 401(k)s may also be accepted by some apartment owners
What to Know Before Apartment Hunting
When you’re ready to go apartment hunting, find out all you can before you even begin your search. After all, it’s no fun to fall in love with an apartment or property only to be turned down. The reality is that not everyone will give you this information over the phone, but it’s worth a try! Then get your personal financial information and proof of income all organized and ready to go.
- Make a list of apartments you like
- Ask about availability (or if there’s a waitlist)
- Ask the monthly rent
- Ask the security deposit required
- Ask if there’s any other fees or deposits required (such as first month’s rent and pet-owner deposits)
- Ask what they require/accept as proof of income or assets
They say knowledge is power — so the more you know, the more successful your apartment search will be. Happy hunting!
This article was written by Sue Sveum, an After55.com contributor.
