What Happens To My Section 8 If I Get A Settlement?

Many governmental assistance programs are income based and require the recipient to make under a certain amount of income every month to qualify for the benefits. One of the programs, Section 8, provides affordable housing to families. If one of the main income earners in a family is supposed to receive a personal injury settlement, will they be able to remain on Section 8? 

If you currently receive Section 8 and are set to receive a personal injury settlement, you will want to talk to your attorney before the settlement is distributed to see how it will affect your Section 8. In many cases, the attorney can protect your settlement from being counted as income, which would affect your Section 8. But it is very important to talk to your attorney before the settlement is issued to handle the money correctly.

If you need help determining how an upcoming settlement may affect your Section 8 benefits, call the Law Offices of Samer Habbas & Associates at 888-848-5084 or contact us online for a complimentary consultation.

Effects Of A Settlement

In California, Section 8 housing is provided to low-income families who cannot afford housing on their income. It usually takes one to two years to get approved for the program. During this time, you are generally on a waiting list. Once approved, the State of California will pay your landlord a portion of the rent on your behalf, making the place where you live more affordable. 

To qualify for even the waiting list, you must prove that you are below a certain income threshold. The State will consider all of the sources of income you have at your disposal. This includes potential settlement income. 

If you receive a settlement before you get off the waiting list, when you are set to receive your Section 8, the State will reevaluate your asset information. The settlement could make you ineligible at that point, even after you waited all that time. If your settlement comes through while you are on Section 8, the State may refuse to continue to pay their portion of the rent, leaving you with the responsibility of paying the entire amount. 

How To Protect Your Settlement

One way that may be able to help you protect your settlement from affecting your Section 8 benefits is to have your attorney create a special needs trust for your settlement. This type of trust will hold the money from your settlement for you, and the trustee will pay you a portion of your settlement either monthly or yearly. This allows you to keep your section 8 benefits and your settlement.

A special needs trust is allowable under California law because you, as the recipient of Section 8, cannot spend the money on whatever you wish. In the eyes of the State, if you can spend the money on anything, you could spend the money on rent and allow them to help another family. You can still use portions of the settlement for specific allowable expenses while maintaining your Section 8 benefits. 

If you are set to receive a personal injury settlement and currently receive Section 8, you must talk to your attorney as soon as you can. Ask how they can help you set up a special needs trust to ensure you can still receive your benefits and keep your settlement check.

Orange County Settlement Planning Attorney

We understand that legal actions can be costly, time-consuming, and emotionally exhausting for you and your family. But, if you are set to receive a settlement while on Section 8, you’ll need to take a few more steps. Law Offices of Samer Habbas & Associates can help you. Call us at 888-848-5084 today, or contact us online.