Tenant screening is a very vital element of having successful and booming Winston-Salem rental properties. But, as a matter of fact, it isn’t constantly trouble-free or easy. There are a lot of 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. Therefore it is so very important to make certain that your tenant screening is not only thorough but that it actually also doesn’t cross the line into discrimination. By means of avoiding discrimination, you really not only avoid potentially expensive lawsuits but on the other hand, you also make sure that your process is fair and in compliance with all relevant laws.
In terms of federal laws about discrimination, the most essential one for property owners to 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 cite 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 rigid set of criteria. This comprises 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 absolutely important to have a clear set of guidelines for every interaction you have with potential or current tenants. This all 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, you should be wise not to ask questions that might force your tenant to disclose protected information. Matters about heredity, race, or national origin are typically inappropriate during tenant screening. The same goes for questions about disability or familial status. Such points should not show up on your application documents and should be avoided in conversation with them unless the tenant mentions it.
It’s additionally significant to review your screening process for other prospective forms of discrimination. By way of illustration, normally, landlords should accept applications and screen tenants in the order in which they are received. Accepting 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 move forward 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 wish for another person to qualify isn’t good.
On a final note, every property owner should have a thorough understanding of the laws in their area related 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. On the other hand, not all criminal offenses are considered sufficient reason to refuse to rent to a certain person. Local laws may differ from federal, which makes it very crucial to be aware of what they are and match your tenant screening process in the same manner.
By knowing the laws in your area, you can ensure that your tenant screening process isn’t discriminating against any individual applicant. Accordingly, you can keep yourself free of legal trouble and significantly reduce potential discrimination lawsuits.
While doing research on every potential income property is a lot of work, Real Property Management of the Triad can help lighten your load. We offer free rental property analyses for investors, which can help you more easily identify whether the income property you want to buy is a profitable option. Contact us online or call us at 336-355-6677 or 336-777-7444 to learn more!
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.