In an effort to provide more education information or landlords I’ve been busy creating some partnerships with other like minded organizations and I’m excited to share the first article from OneRent, a property management and rental services company from California.
They’ve been helpful enough to provide an article covering the US Fair Housing rules, hopefully you find it helpful and can share it with other landlords in your circle to keep them educated as well.
Also, if you find the information helpful be sure to leave a comment for them down below!
The Federal Fair Housing Acts (42 U.S. Code § §3601-3619, 3631) prohibit discrimination
on the basis of race, religion, national origin, gender, age, familial status and physical or
mental disability (including recovering alcoholics and people with a past drug addiction).
Many states and cities also prohibit discrimination based upon marital status or sexual
orientation. For this reason, it’s best to consider those factors protected as well, just to
be on the safe side. With that understanding, here’s how to avoid fair housing violations
in tenant screening.
First of all, make sure everyone on your staff treats anybody who responds to one of
your vacancy advertisements in the exact same fashion. To ensure this, establish a
procedure by which the interview process is conducted and insist upon it being followed
to the letter—each and every time. To standardize this procedure, prepare a checklist of
questions and make sure applicants are never — under any circumstances — asked
questions relating to the protected parameters above.
Yes, as a property owner, it is absolutely your right to establish a set of criteria by which
people can be qualified to rent one of your places, as long as none of the above issues
are included among them. To ensure you’re always in compliance, establish a written
document listing the criteria by which you measure the suitability of a prospective
tenant. Insist your rental agents become intimately familiar with them and follow them
religiously.
Legally, you are within your rights to decline to rent to individuals with bad credit
histories, income you can reasonably regard as insufficient to pay the rent, or past
behavior — such as property damage or consistently late rent payments. These traits
can be plausibly established as making someone a bad financial risk.
While you are free to include probing questions to elicit information regarding any of
those risks, your rental application should be completely impartial regarding any of the
protected factors. In other words, it’s OK to ask for financial information, job history,
criminal record, previous rental experience and the like. But you must stay away from
anything having to do with the protected terms. To keep everyone honest in this regard,
Federal agents randomly apply for rentals to ensure the law is being followed. Fines can
be in the five-figure range, so make sure your people know it is not OK to exhibit
discriminatory behavior—not even once.
It is also a violation to “steer” certain people into certain properties, or certain parts of a building. Whenever an applicant asks about any other openings you may have, you are
obligated to tell them about every vacancy in your portfolio, even if you think some may
be beyond their reach financially. Never assume this is the case, as you could come off
as being discriminatory and get into trouble. All you can do is take their application and
process it according to the written qualifying criteria you’ve established. If they meet all
of the requirements, they get the place—it’s that simple.
With all of the above in mind, the absolute best way to avoid Fair Housing violations in
tenant screening is to be unyieldingly consistent in your dealings with prospects. This
includes extending gestures such as offering an older person, a disabled individual, or a
single mother a break on the rent or the security deposit without making similar offers
to all other applicants.
Everyone must meet the same standards—period.
You also want to keep in mind those whom you employ can get you held liable for their
discriminatory actions. As the landlord, you’re expected to set an example and see to it
everyone lives up to them. Always make sure all applicants get the same information
about every place you have open and keep your written criteria close at hand should it
ever be questioned.
If you and everyone on your staff always do this, you should be OK.
Under no circumstances should the information conveyed in this article be considered
legal advice. If you have specific questions in this area, consult a real estate attorney
familiar with the Fair Housing regulations.
Onerent is a rental leasing and management service for the modern owner and renter, managing over 1,000 properties across the San Francisco Bay Area, and Greater Seattle.
For more real estate investing tips visit the Build with Onerent real estate blog
I completely agree that its crucial not to discriminate against prospective tenants for all the reasons mentioned in this article, but 1 paragraph raised my eyebrows:
‘With all of the above in mind, the absolute best way to avoid Fair Housing violations in
tenant screening is to be unyieldingly consistent in your dealings with prospects. This
includes extending gestures such as offering an older person, a disabled individual, or a
single mother a break on the rent or the security deposit without making similar offers
to all other applicants’.
If as a landlord you’re cutting some people breaks that others don’t get isn’t this a case of treating all people equally but some more equally than others? And how can this preferential treatment for some then be defined as ‘unyieldingly consistent’?
Hi Jan,
The irony of this is the more you as a landlord try to help, the more you put yourself in jeopardy. It’s not because you’re not doing the right thing, it’s because the way the laws have been created often help the whiniest people.
The ones who complain that the senior on a fixed income didn’t get a rent increase and they did don’t care about the senior, they care about themselves, so they complain. This is where the line between discrimination and government simply meddling starts to get very blurry.
So I too don’t fully agree with #1, yet it’s the rules so I simply don’t give anyone discounts (that people know about…)
Bill
Nothing new, great reminders of do’s and don’s.
Sometimes the reminders are the most important parts! Once we get a bit more experience under our belts as landlords we sometimes forget what we’ve learned so I find reminders like these are a good refresher!
And hopefully there may be a new lesson for soem of the folks visiting!
Bill