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How to Avoid Fair Housing Violations in Tenant Screening

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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

Finding Your Passion

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Today’s quick thought is about passion.

I’ve been talking to a multiple different groups and organizations in the last week (groups specifically involved in Real Estate) and the one thing coming through is there passion.

And that passion seems to fit in various different camps.

Some are passionate about Real Estate, some are passionate about helping others and some seem to be passionate about just selling there products.

Passion can be a great thing as it does help you through the tough times and through the trying times. It seems to actually make the tough times actually easier.

Most important, it actually seems to be a requirement for long term success. We see it in many successful people around us.

Bill Gates was passionate about computer software, Warren Buffet was passionate about stocks and you can be passionate about your rental property. I’m not saying you need to go the route of the first two fellows, but if you’re passionate about creating a home for good people, while creating a nice reward for yourself, you can really succeed with your rental property.

If you treat it as “just a rental” or can be defined as a “slumlord”, your passion may not lean towards being a good successful landlord, but rather simply about money. That may get you closer to a money goal, but you might need to rethink your passion.

Find that balance, find that point of passion, that something that makes you happy and don’t let it drag you to just the money side, but rather let that be a bonus along the way. Like being a smart educated successful landlord 8′]

What are your thoughts? Does this ring true for you? Do you disagree? Leave a comment below and/or don’t forget to share on Facebook and Twitter if you like it!

Thank You For Being such An Awesome Landlord!

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awesome landlords are created by an awesoem circleWhen was the last time you received an email, a text or even had a tenant say that to you?

For me it was last Monday.

So why did I get that text?

Before I jump to that let me first say, it’s important to have good people in your circle. Whether it’s tenants, friends, contractors or people you trust. I wouldn’t get messages like that without that circle.

Onward.

I received a text from the tenant Monday morning, her son was off school and trying to get laundry done for the next day and the washing machine quit draining. Like all well organized teenagers, he was completely out of clean clothes and now the ones he needed were sopping wet and obviously not clean.

I let her know I’d reach out to my appliance guy and since Monday was a local holiday in my area (Family Day) I said I wasn’t sure if he could get there until possibly Tuesday or Wednesday.

I sent Allen the text and didn’t expect to hear anything back until Tuesday some time, but a bit later he asked for the address and the tenants info so he could coordinate directly with her (why coordinate through me as it just delays things and adds steps).

I left it at that until I received a text just after dinner from Allen confirming which company the property was under ( I operate under two companies). curious I told him and inquired when he might be by and he replied, it’s done!

Just a few moments after that the message from the tenant came in! Washing machine was fixed, laundry was being dealt with and I not only, correction, my circle not only got her up and running but it was done two days faster than she thought and on a holiday.

Allen emailed me the invoice and asked if it was possible to get paid that night, since he was so quick I e-transferred money to him half an hour later rather than waiting until i was back at my desk the next morning.

So Many Lessons From This

Here’s your take aways. Let me know if any resonate with you!

Under promise and over deliver. I guessed Wednesday to allow time in case he was backed up and was hoping for Tuesday knowing if it did take until Wednesday everyone knew in advance.

My guy over delivered by doing the work right away.

Your circle. You need good people to help you succeed, you can’t do everything on your own.

Build up trusted people around you to create people you want to work with, people you trust to work with and people who help make you better.

And finally, the right people make you better.

I have a great tenant, I have systems in place and back to my circle being awesome. This allowed me to get everything done with a few texts, a few minutes sending an email and the rest of the time I got to take advantage of the holiday and watch some movies with my family while my great people made me look awesome.

What can you do to apply any of this to your landlording business?

Happy Landlording!

 

 

The Noble Profession

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Real Estate conversations can happen anywhere - The Noble ProfessionI had some minor hand surgery last week (I’ll spare the graphic pics and details) and as it was completed with a local anaesthetic I was awake the roughly 40 minutes it took.

The surgeon enjoyed chatting while he worked so like many of my conversations with people, it eventually turned to Real Estate (I tend to steer Real Estate into conversations, if they are interested we stay on topic, if not… next topic).

As I told him what I did he informed me he actually owned the small apartment/commercial building where his office was located and he basically said (and I’m paraphrasing a bit as I couldn’t take notes at the time) “What a noble profession landlording is.”

Some of you may be thinking what was he talking about, others will be going I get that. Depending on your stance or position on that comment it can make a huge difference as to what kind of landlord you are.

Here’s what else the respected surgeon had to say, again paraphrased. Sure it’s great being a doctor and helping people, but landlords give people homes.

It’s not just a rental property, it’s a home, let that sink in. That’s not a paraphrase, that’s me speaking.

Yes you have to be diligent, yes you need systems, yes you could be (and should be) creating a long term investment for yourself, but ultimately you’re creating homes for people who need them and that’s pretty darn noble.

That’s my Friday thought for you, I’d love to a) have you share your thoughts about this “noble profession” as a comment below and b) have you share this with other people to spread the word all landlords aren’t slumlords. Most of us are pretty damn good folks, at least in my opinion!

So share it on Facebook, LinkedIn or Twitter (or all of them) using the share buttons below, share it with other landlords and talk about it with your friends. Happy Friday.

Mold Remediation – A Guide To Dealing With Mold in Your Rental Property

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There’s an expression about not making a mountain out of a molehill — it refers to there being no need to overreact to situations for which there is a simple solution. But a MOLD hill … that’s something different entirely. Any hill, patch or clump of mold of any size deserves your immediate attention if you are a landlord, because depending on what caused the mold to grow, liability can fall upon you if a tenant becomes ill.

Moisture is a key contributor to the growth of mold in buildings. Mold also requires high relative humidity, and an organic food source, which is provided by many building materials. Eliminating moisture is the easiest way to control mold growth, and a landlord who fails to address a moisture or water issue after being notified about it might be held liable. The situations in which a landlord could be expected to take steps to eliminate the water source include (but are not limited to):

  • A leaky roof
  • Leaky pipes
  • A musty smell
  • Broken windows
  • Damaged siding
  • A broken humidifier

Many people are sensitive to molds and can have severe reactions. While causation of a severe illness can be difficult to prove, any litigation that results from a mold issue could tie you up in court and lead to tenant loss.

There are a number of steps to take to minimize the damage from mold after a water “event” such as flooding or a burst pipe. Most important to know is that action must be taken within 24 to 48 hours, and a mold remediation company can help. Other basics include:

  • Make repairs/eliminate the water source ASAP
  • Temporarily move the tenant if necessary.
  • Wear protective clothing when confronting mold.
  • Meet EPA guidelines in carrying out remediation efforts.
  • Document all remediation efforts in case there is litigation

The accompanying infographic outlines these steps and more. It also includes tips to help landlords prevent mold issues from occurring in the first place. Awareness about mold issues can help eliminate an uphill battle — one with a much steeper climb than a molehill.

American Apartment Owners Association is the largest landlord association in the country. They offer a large range of services including credit checks, rental applications, landlord forms, and tenant screening. AAOA’s mission is to provide superior property management services that will equip landlords to better manage their investment properties.

Maybe You Should Quit?

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If you’ve never read the book “The Dip” by Seth Godin*, it might be worth checking out.

Seth talks about the dip you sink into before you gain the momentum to succeed. Sort of along the line of it’s darkest before the dawn.

What it boils down to, is that so many people get to the brink of success and then it gets tough, or it gets boring or they get overwhelmed. So they quit.

Now sometimes it makes sense. That dip may be huge and quitting might be the right solution.

But far too often the issue I see with landlords is they quit at the dumbest time.

They just finished evicting a bad tenant or they just dealt with an expensive repair and now they throw their hands in the air saying it’s not worth it and they quit.

Maybe You Should Quit Landlording, Or Maybe Not

Sorry, but that’s dumb and here’s why. You’ve just evicted a tenant which can be one of the worst issues you deal with.

Now you have a better understanding of the process so it’s easier next time and you’ll act quicker to avoid any additional pain. You’re aware of what a pain an eviction can be so you are apt to be much more diligent screening going forward to avoid it.

If you’ve just spent a ton of money repairing a roof or replacing a furnace you now have many years of not having to deal with that expense again.

You’ve just gone through a dip and coming up on the other side it’s going to be much better, much less expensive and easier.

Bottom line, getting through the hard times makes future challenges easier so rather than quit, ask yourself how getting through the lows can help you! If the hard times sound too scary, well maybe you should just quit now…

*the link to Amazon is an affiliate link. If you purchase the book after clicking the link I get a very small commission so you are aware. If you buy it thanks and I’m positive it will help you, if you’re offended I might make a commission for recommending something I believe is helpful, maybe you need to move on as I really won’t be able to help you.

You Need To Use The Word NO More Often

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learn to use the word noHey, you free later today? NO!

We were wondering if we could repaint the living room purple? NO!

I know you said no pets, but my daughter would love a dog and we would be sure to clean up after it. NO!

Can I have an hour of your time? NO!

This tidbit relates to more than just landlording, it relates to life. We don’t say no enough. I know I don’t.

I just want to help people, but you can’t help others until you help yourself.

If someone wants your time, what do you have to sacrifice? Family time? Time to build your business? Time to unwind from your work?

What’s the payback (I know you can’t always expect payback every time so you do have to pick your battles)? If you give up your time, does it help you, or is it a one sided affair?

It’s fine to help others, just don’t do it to the detriment of yourself.

Sorry if it seems callous, but that yes to repainting could cost you four hours of your time repainting later. Maybe ten hours if you have to scrape paint off floors and ceilings because they are amateur painters.

That yes to a dog could cost you your lawn and perhaps lead to needing to replace flooring, renting the property for less later due to the condition and who knows what. You have a pet policy in place before they moved in, why should it change?

That yes to an hour of your time may be super helpful to someone drilling you for information, but it could have prevented you from buying your next property, finishing up some accounting, or some other fun task. Find your balance, it may not require saying NO all the time, but maybe just a few more times a week.