A vital part of owning successful Jefferson rental properties is tenant screening. But it’s not that easy. Federal or local landlord laws will affect how you go about your screening process. These laws have been put in place to reduce potential discrimination against tenants right from the first conversation. This is why you should aim for your tenant screening to not just be thorough, but also to not be categorized as discrimination. A lot of expensive lawsuits arise from issues about discrimination. Avoiding that would also mean your process is fair and in compliance with all relevant laws.
When it comes to federal laws about discrimination, the most important law for property owners to understand is the federal Fair Housing Act (FHA). This set of laws comes into play in all aspects of tenant-landlord interaction. The FHA has prohibitions that penalize those who refuse to rent a property based on a tenant’s race, religion, family status, or disability. The FHA also protects tenants from deceit by landlords who say a rental house is unavailable when it is or those who require certain tenants to meet stricter criteria. Landlords should not require a higher security deposit from certain tenants nor evict someone for any reason that would not cause them to remove a different tenant.
You must have a clear set of guidelines for every interaction you have with potential or current tenants. This should be applied beginning with the initial conversation you have with parties interested in your rental property. In that conversation, you must lay down your approval criteria and expectations.
However, you shouldn’t ask questions that might force your tenant to disclose protected information. Inquiries about heredity, race, or national origin are deemed inappropriate during tenant screening. You shouldn’t also ask questions about disability or familial status. None of these questions must be on your application documents. In addition, you are not to have conversations about them unless the tenant brings it up.
Filtering your own screening process for other forms of discrimination is also very important. As a rule, receiving applications and screening of tenants should be done in the order in which they were received. Once an application has been received, a landlord must always process it immediately and not wait for someone else to apply. That would also be discrimination. If an applicant has paid the required fees and their application documents are complete, you should continue with the screening process for that applicant. Disqualifying an applicant based on pre-determined criteria, such as their credit score or poor references, is perfectly fine. On the other hand, it is not right to make an applicant wait for an answer because you keep hoping for another person to qualify.
Lastly, you should have a complete understanding of the laws in your area that pertain to renting to people with a criminal record. The FHA leaves property owners with a surprising amount of leeway when disqualifying a tenant based on their criminal record. However, you must know which criminal offenses are considered sufficient reason to refuse someone a rental application. Knowing how your local laws differ from federal laws will help you adjust and align your tenant screening process.
When you know the laws in your area, you can ensure that your tenant screening process isn’t discriminating against any specific applicant. With this, you are also keeping yourself free from legal troubles brought about by discrimination lawsuits.
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.