(from Memo to Members of the NLIHC)
In a letter to regional public housing authorities, Donna Ayala, director of the Office of Public Housing in the Boston Hub of HUD, interpreted the provisions of the Protecting Tenants at Foreclosure Act (PTFA) as they apply to the Section 8 program.
PTFA provides general protections for all tenants in a foreclosed property, and offers specific protections for tenants receiving Section 8 assistance (see Memo, 5/22). Generally, tenants must receive notice 90 days prior to being required to vacate the foreclosed property, and tenants with bona fide leases can, in most cases, remain for the term of their lease. When the tenant has Section 8 assistance, the law also requires that both the Section 8 lease and the housing assistance payment transfer to the new owner, or successor in interest, at foreclosure.
Ms. Ayala noted that the provisions of the PTFA were effective as of May 20 and require that the property's immediate successor in interest "assume both the existing Section 8 lease and the existing Housing Assistance Payment (HAP) contract."
She also noted that these changes are applicable even if the foreclosure occurred prior to May 20. Ms. Ayala stressed that it is the responsibility of the Section 8 administrator to identify and work with the new owner to ensure that the rights and obligations under the HAP contract are understood and that the new owner acts in compliance with that contract.
A copy of the letter can be found at
http://www.nlihc.org/doc/HUD-Advisory-Letter-09-02-1.pdf
