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Tenant Screening – Make Sure You’re Not Discriminating

Close Up View of a Southport Rental Property ApplicationTenant screening is a very necessary aspect of owning booming and successful Southport rental properties. However, it isn’t trouble-free or easy all the time. There are several inadvertent ways that your screening process could run afoul of federal or local landlord laws. These laws are designed to help reduce potential discrimination against tenants, laws that protect them right from the very first conversation. For this reason, it is so crucial to make sure that your tenant screening is not only thorough but on the other hand, that it also doesn’t cross the line into discrimination. By just avoiding discrimination, you effectively not only avoid potentially expensive lawsuits but at the same time, you additionally nail down that your process is fair and in compliance with all relevant laws.

As concerning federal laws about discrimination, the most imperative one for property owners to ascertain and grasp well is the federal Fair Housing Act (FHA). This set of laws covers every aspect of tenant-landlord interaction. The FHA does not allow property owners to refuse to rent a property based on a tenant’s race, religion, family status, or disability – to bring up a few. The FHA also prohibits landlords from telling a tenant a rental house is unavailable when it is, or to require certain tenants to meet a more demanding set of criteria. This constitutes requiring a higher security deposit from certain tenants or evicting someone for any reason that would not cause you to remove a different tenant.

It’s seriously important to have a clear set of guidelines for every interaction you have with potential or current tenants. This definitely starts with the very first conversation you have with someone looking to apply for your rental property. In that first conversation, you should make it a point to describe your approval criteria and expectations.

But then again, you should be really watchful not to ask questions that might force your tenant to disclose protected information. Concerns about heredity, race, or national origin are typically inappropriate during tenant screening. The same goes for questions about disability or familial status. Such issues should not be included in your application documents and should be avoided in conversation with them unless the tenant discusses it.

It’s also essential to revisit your screening process for other unintentional forms of discrimination. As an example, typically, landlords should accept applications and screen tenants in the order in which they are received. Obtaining and then sitting on an application because you’re waiting for someone else to apply is a form of discrimination. If an applicant has paid the required fees and their application documents are complete, you should go on with the screening process for that applicant. Disqualifying an applicant based on pre-determined criteria, such as their credit score or poor references, is totally fine. But making an applicant wait for an answer while you hope to find another person to qualify isn’t.

One last thing, every property owner should have a thorough understanding of the laws in their area in relation 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. But in actuality, not all criminal offenses are considered sufficient reason to refuse to rent to anyone. Local laws may differ from federal, which makes it vital to comprehend what they are and fine-tune your tenant screening process rightly and accordingly.

By knowing the laws in your area, you can ensure that your tenant screening process isn’t discriminating against anyone applicant. Because of this, you can keep yourself free of legal trouble and significantly reduce potential discrimination lawsuits.

Need some property management advice, or maybe you’d rather have someone else take care of it for you? Give Real Property Management Champion a call at 910-782-4488 or contact us online today!

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.