Most well-intended landlords think they are conducting non-discriminatory tenant screening and have no intention to discriminate during their rental screening process. Unfortunately, being uninformed about the law can lead to unintended mistakes. This in turn can result in litigation, which can rack up substantial bills in legal fees and fines.
For example, it is illegal to refuse to rent to families with children or women who are pregnant. It is also illegal to discriminate based on race or a disability. However, some new landlords might not be aware that doing so could result in a lawsuit.
The following is a compilation of six key non-discriminatory tenant screening guidelines for landlords to help ensure rental screening is never conducted in a discriminatory manner:
1. Know the 7 Classes of the Fair Housing Act
The U.S. Fair Housing Act outlines seven main areas that are off limits for landlords while they are conducting their screening process. They are: race, sex, skin color, national origin, religion, family status or disability. Asking written or verbal questions about these areas as part of the screening process is illegal. Discouraging certain classes through rental advertising is also illegal.
2. Know State and Local Laws
In addition to these federal U.S. Fair Housing Act requirements, each state and municipality may have additional housing laws. It is crucial for landlords to be aware of and current on these laws so that they can remain in compliance. Age, sexual preference and occupation are just a few examples. Partnering with a professional screening company will ensure assistance in background screening that is kept within the parameters of the law.
3. Be Consistent
While the tenant screening process should follow the letter of state and federal laws, it should also be the same for every applicant. Landlords should develop a comprehensive non-discriminatory tenant screening process and then make sure it is applied to every applicant uniformly. No one should receive preferential treatment.
4. Send An Adverse Action Letter For Rejections
After rejecting prospective tenants, consider sending an adverse action letter, also known as a declination letter. The letter should state the legal reason(s) why the applicant was rejected, such as insufficient income or credit history problems. There are templates available online that clearly show acceptable reasons for rejecting an applicant and assist landlords in covering themselves legally. This step can assist greatly in avoiding screening-related discrimination claims.
5. Enlist a Professional Non-Discriminatory Tenant Screening Company
Landlords should strongly consider hiring a professional non-discriminatory tenant screening background check company to take care of a portion of the tenant applicant screening. This can ensure that crucial portions of the screening are conducted in a legal and comprehensive manner, reducing the chances of legal action taken due to discriminatory behavior.
6. Keep Records and Paperwork On File
Retain paperwork related to all applicants for at least 3 years, even for those that do not become tenants. A paper trail proving that non-discriminatory tenant screening was done professionally and legally will help to ensure a ruling in the landlord’s favor should legal action arise down the road.
Most landlords are well-intentioned and do not set out to discriminate when they are screening a rental applicant. However, some of the legal parameters can be unclear, and laws can also be amended over time. Partnering with a professional non-discriminatory tenant screening company can assist with staying compliant and renting to the very best candidates.
Source: https://www.thebalance.com/what-s-an-adverse-action-notice-959985
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